ACKNOWLEDGEMENT

Human Resource Management is said to be the backbone for any

organization as it studies the most significant resources of the organization i.e.
human. HRM helps in managing people within an organization. It helps in
accomplishing the maximum out of the minimum.

The thesis work “Human Resource Management Practices in Large Scale

Industries: A Case Study of Century Pulp & Paper Mill, Lalkuan (Nainital)” focuses
on the importance of human resource management practices in large scale industries
with a special attention on Century Pulp & Paper (CPP) Mill, Lalkuan (Nainital). All
the functions of HRM are studied and then correlated with the same in CPP. The
main aim of this work of the researcher is to study the HRM practices in CPP and
thus give few suggestions to the organization so that they can make the use of their
human resources more effectively and efficiently.

The presented work is divided into seven chapters where the first chapter
Introduction, gives the general introduction of HRM, its evolution, objectives,
importance, functions, etc. along with the general introduction of Century Pulp &
Paper Mill, Lalkuan (Nainital). The chapter also tells about the research
methodology used for the research work.

Second chapter gives the general view of Human Resource Planning, its
forms, process limitations etc. along with the Human Resource Planning in CPP
Mill, Lalkuan.

The Third chapter deals with Recruitment, Selection and Training process in
general and the same is correlated with the recruitment, selection and training
process in CPP.

The fourth chapter includes with the next function of HRM i.e. Motivation,
its theories, various tools of motivation along with the motivation process in CPP
and the various tools used there.
The fifth chapter includes with the meaning of grievance, grievance procedure,
industrial relations (IR), industrial disputes arising in the organization and
 CONTENTS

S. Chapters Page
No. No.
1 Introduction 1-28
1.1 Human Resource Management 1
1.2 Evolution of Human Resource Management 1
1.3 Objectives of Human Resource Management 6
1.4 Importance of Human Resource Management 7
1.5 Functions of Human Resource Management 7
1.5.1 Managerial Functions 8
1.5.2 Operative Functions 8
1.6 Human Resource Management Practices in SAIL 9
1.7 Human Resource Management Practices in TATA 10
Steel
1.8 Obstacles in the growth of Human Resource 13
Management in India
1.9 An introduction to Century Pulp & Paper Mill, 14
Lalkuan (Nainital)
1.9.1 CPP Products 15
1.9.2 Commitment to Quality and Service 17
1.9.3 About Workforce in CPP 17
1.9.4 Products and Types of Products 18
1.9.5 Process Description 19
1.9.6 Human Resource Management in CPP- At a Glance 20
1.10 Methodology Used 23
1.11 Literature Review 23
1.12 Constraints 26
1.13 Conclusion 26
References 27-28
2 Human Resource Planning 29-50
2.1 Need of Human Resource Planning 29
2.2 Forms of Human Resource Planning 30
2.3 Human Resource Planning Process 30
 2.4 Job Analysis and Job Design 38
2.5 Problems and Limitations of Human Resource 43
Planning
2.6 Human Resource Information System (HRIS) 44
2.7 HR Practices in India 45
2.8 Human Resource Planning and the Government 45
2.9 Human Resource Planning in CPP Mill, Lalkuan 45
2.10 Conclusion 48
References 50
3 Recruitment, Selection and Training 51-83
3.1 Recruitment 51
3.1.1 Factors Affecting Recruitment 51
3.1.2 Recruitment Process 52
3.1.3 Sources of Recruitment 54
3.2 Selection 57
3.2.1 Selection Process 57
3.2.2 Placement & Induction 58
3.3 Training 58
3.3.1 Need & Importance of Training 59
3.4 Recruitment and Selection Process in Century Pulp & 62
Paper Mill
3.4.1 Some Important Terms & Conditions in CPP 71
3.4.2 Methods of Recruitment in CPP 72
3.4.3 Training & Development in Century Pulp & Paper 75
3.5 Conclusion 82
References 83
4 Motivation 84-108
4.1 Importance of Motivation 85
4.2 Theories of Motivation 86
4.3 Motivational Tools 95
4.4 Various Motivational Tools in CPP 98
4.5 Conclusion / Suggestions 105
References 107-108
5 Grievance and Grievance Handling 109-127
5.1 Meaning of Grievance 109
5.1.1 Causes of Grievances 109
5.1.2 Forms of Grievances 110
5.1.3 Effects of an Undressed Grievance 110
5.2 Grievance Procedure 111
5.2.1 Need For Grievance Handling Procedure 111
5.2.2 Steps Followed in Grievance Handling Procedure 112
5.3 Industrial Relations (IR) 114
5.3.1 Significance of Industrial relations 114
5.3.2 Essentials of Good Industrial relations 115
5.3.3 Causes for Poor Industrial relations 116
5.4 Industrial Disputes 117
5.4.1 Types of Industrial Disputes 117
5.4.2 Industrial Disputes-Settlement Measures 118
5.5 Trade Unions 120
5.5.1 Objectives of Trade Unions 120
5.6 Grievance and Grievance Handling Procedures in 121
CPP Mill, Lalkuan
5.6.1 Collective Bargaining in CPP Mill, Lalkuan 123
5.6.2 Disputes in CPP Mill, Lalkuan 123
5.7 Conclusion 126
References 127
6 Problems and Difficulties 128-147
References 147
7 Conclusion 148-154
Bibliography 154-159
Annexure 160-173
Questionnaires 174-179
8 Research papers
 TABLES

Table Title Page

NO.
1.1 The Transmission of Personnel Function from one stage to other 3
1.2 Shifts and Timings in CPP 18
1.3 HRD Department in CPP 22
2.1 Staff Forecast Form 32
2.2 Demand Forecast-Inspectors 33
2.3 Feedback of Executives on HR Planning in CPP 46
2.4 Feedback of Skilled Employees on HR Planning in CPP 47
2.5 Feedback of Unskilled Employees on HR Planning in CPP 48
3.1 Recruitment Practices followed in India 56
3.2 Steps in Training Program 60
3.3 Sources of Need Analysis Data 61
3.4 Qualification & Experience required for each grade of workmen 72
3.5 Specimen of Monthly Calendar in CPP 76
3.6 Feedback of Executives on Recruitment, Selection & Training in 80
CPP
3.7 Feedback of Skilled Employees on Recruitment, Selection & 81
Training in CPP
3.8 Feedback of Unskilled Employees on Recruitment, Selection & 81
Training in CPP
4.1 Table showing status of GPA in CPP 102
4.2 Feedback of Executives on Motivation in CPP 103
4.3 Feedback of Skilled Employees on Motivation in CPP 104
4.4 Feedback of Unskilled Employees on Motivation in CPP 104
5.1 Feedback of Executives on Grievance & Grievance Handling in 124
CPP
5.2 Feedback of Skilled Employees on Grievance & Grievance 125
Handling in CPP
5.3 Feedback of Unskilled Employees on Grievance & Grievance 125
Handling in CPP
 FIGURES

Fig. Title Page

NO.
1.1 Maslow’s Hierarchy of Needs 5
1.2 Human Resource Management 7
2.1 Techniques of HR Demand Forecasting 31
2.2 Regression line showing relationship between Sales and 35
Employees Size
2.3 Estimating Internal Labour Supply for a given Unit 37
2.4 Programme Planning Options 38
2.5 Components of Job Analysis 39
2.6 Process of Job Analysis 41
3.1 Recruitment Process 53
3.2 Types of Training Methods 62
3.3 Recruitment & Selection Flow Chart in CPP 63
3.4 Sourcing in CPP 64
3.5 Joining Formalities in CPP 67
3.6 Flow Diagram of Training & Development Activities in CPP 74
4.1 Motivation Process 84
4.2 Maslow’s Need Hierarchy Theory 86
4.3 Herzberg’s view of Job Satisfaction and Job Dissatisfaction 89
4.4 Comparison of Maslow’s and Herzberg’s Theory of Motivation 90
4.5 Expectancy Theory from a Manager’s Perspective 91
4.6 Porter and Lawler Model of Motivation 93
4.7 Adam’s Equity Theory 94
4.8 Alderfer’s ERG Theory 94
5.1 Steps in Grievance Handling Procedure 112
5.2 Model Grievance Procedure 113
5.3 Grievance Handling Procedure in CPP 121
 ABBREVIATION

Abbreviation Full Form

ASCIJI Administrative Staff College of India Journal
BPL Below Poverty Line
CPP Century Pulp and Paper
DET Diploma Engineer Trainee
DGM Deputy General Manager
DIP De-inking Plant
EMS Environment Management System
EPF Employees Provident Fund
ESI Employee’s State Insurance
ESIC Employee’s State Insurance Corporation
ETP Effluent Treatment Plant
FBC Fluidized Bed Boiler
GET Graduate Engineer Trainee
GM General Manager
gsm Grammage per Square Meter
HOD Head of Department
HR Human Resource
HRA House Rent Allowance
HRD Human Resource Department
HRIS Human Resource Information System
HRM Human Resource Management
HRP Human Resource Planning
IAMR Institute of Applied Manpower Research
IIM Indian Institute of Management
ILC Indian Labour Conference
IR Industrial Relations
ISMS Information Security & Management System
ISO International Organization for Standardization
KSA Knowledge, Skill & Attitude
L&T Larsen and Turbo
M/C Machine
MB Act Maternity Benefit Act
MBO Management b Objectives
MIS Management Information System
MIT Massachusetts Institute of Technology
MOU Memorandum of Understanding
MP Act Miscellaneous Provisions Act
MPM Meter Per Minute
MT Metric Ton
MW Mega Watt
OBC’s Other Backward Castes
OHSAS Occupational Health & Safety Assurance Series
OJT On Job Training
OT Over Time
PF Provident Fund
PG Act Payment of Gratuity Act
PPE’s Personal Protective Equipments
QC Quality Circle
RGP Rayon Grade Pulp
SC’s Scheduled Castes
SLC Standing Labour Committees
ST’s Scheduled Tribes
TDK Toyo Denko
TG Turbo Generator
TPA Ton Per Annum
TPD Ton Per Day
TPM Total Productive Maintenance
VP Vice President
WC Act Worker’s Compensation Act
WPM Worker’s Participation in Management
WPP Writing & Printing Papers
WTP Water Treatment Plant
MAP OF CENTURY PULP AND PAPER MILL,
LALKUAN (NAINITAL)
 1

Chapter 1

INTRODUCTION

An organization comprises of both human as well as non-human / non-living

resources, but the most significant resource of an organization is said to be the
human or people working there. The importance of this resource is due to its
unique characteristics. Firstly, it is the human that make use of other non human
resources. Secondly, it is the only resource that can convert non human resources
into useful and consumable resources utilized for achieving organizational
objectives. Last but not the least humans are heterogeneous in nature as they
differ in personality, behavior, values, emotions etc. which makes difficult for the
organization to use them in an effective and efficient manner.

Business houses are made or broken in the long run not by markets or capital,
patents, or equipments, but by men.1

1.1 HUMAN RESOURCE MANAGEMENT (HRM)

Human Resource in simpler sense can be defined as “HRM is a process of

making the efficient and effective use of human resources so that the set of goals
are achieved.”2

Personnel Management or say human resource management is the planning,

organizing, directing and controlling of the procurement, development,
compensation, integration, maintenance and separation of human resources to the
end that individual, organizational and social objectives are accomplished.3 Thus
HRM can be defined as a process of managing people within an organization in
such a manner that predetermined objectives can be achieved more efficiently
and effectively.

1.2 EVOLUTION OF HUMAN RESOURCE MANAGEMENT

Human Resource Management as a subject of study is relatively a new concept as

compared to other management studies. However evidences are available to site
that the concepts upon which the recent Human Resource Management theory is
based have their roots in history for example, the minimum wage rate and
incentive wage plans are found to be include in the Babylonian Code of
Hammurabi around 1800 B.C.4
 2

In ancient China too useful principles of managing human resources were well
known. L.S. Hsu has highlighted the ancient Chinese parables containing
practical suggestions to select honest, capable and unselfish public officers.
Confucius was well known for his useful principles in China. 5 “The best known
books of wisdom in China ‘Tao Te Ching’ written by Lao Tzu in the fifth century
B.C. explains how (Tao) things work, (Te). This book (Ching) deals with the role
of a good leader in managing human resources.”

Adam Smith talked over the application of principle of specialization to

manufacturing workers, its control and concept in 1776. In 1800 James Watt
introduced standards of operating procedures, specifications, work methods,
incentive wages etc. However, In 1810, Robert Owen referred as the Father of
Personnel Management was the one who acknowledged the need for paying
attention to the welfare of the “vital machines” or “animate Machines” . He made
provision for reduced working hours, housing facilities, education of workers and
their children and a system of discipline combined with justice in the factories
being managed by him. He also took active part in the introduction of British
Factory Act, 1819. He preached that personnel management pays dividends to the
employer and is an essential part of every manager’s job. He advised his fellow
employers to devote as much attention to their “vital machines”(workers) as they
did to their inanimate machines. By doing so profits must be maximized.6

HRM is not new in India but we are trying to develop it as a systematic

approach now. Even Jamshetji Tata, owner of the Tata Iron and Steel Company
that started its operations in the year 1911 had the vision of management at that
time itself. As early as 1917, he wrote to his son7, “The welfare of the labouring
classes must be one of the first cares of every employer. Any betterment of their
conditions must proceed far more from the employers downward rather than be
forced up by demands from below, since lobour contented, well housed, well fed,
well brought up generally well looked after, is not only an asset and advantage to
the employer, but it also serves to raise the standard of industry and labour of
today; we are also securing a supply of healthy and intelligent labour for the
future.”

After the realization of importance of labour officers in Indian industries, the

Royal Commission on labour was set up in 1929. In 1931, the commission
recommended the abolition of most famous jobber system at that time as well as
the appointment of lobour officers in industries to look after recruitment and
welfare of employees. Many of the associations like Bombay Mill Owner’s
Association, Jute Mills Association in West Bengal started appointing lobour
officers who were required to attempt to settle grievances and disputes within the
industries.
 3

The transmission of personnel function from one stage to other in a chronological

order can be examined in the form of a table :

Table 1.1: The Transmission of Personnel Function from one Stage to Other
Concept What is it all about?

The Commodity Labour was regarded as a commodity to be bought and

Concept sold. Wages were based on demand and supply.
Government did very little to protect the workers.

The factor of Labour is like any other factor of production, viz,

Production Concept money, materials, land, etc. Workers are like machine
tools.

The Goodwill Concept Welfare measures like safety, first aid, lunch room, rest
room will have a positive impact on workers’
productivity.

The Paternalistic Management must assume a fatherly and productive

Concept/ attitude towards employees. Paternalism does not mean
Paternalism merely providing benefits but it means satisfying
various needs of the employees as parents meet the
requirements of the children.

The Humanitarian To improve productivity, physical, social and

Concept psychological needs of workers must be met. As Mayo
and others stated, money is less a factor in determining
output, than group standards, group incentives and
security. The organization is a social system that has
both economic and social dimensions.

The Human Resource Employees are the most valuable assets of an

Concept organisation. There should be a conscious effort to
realise organisational goals by satisfying needs and
aspirations of employees.

The Emerging Concept Employees should be accepted as partners in the

progress of a company. They should have a feeling that
the organisation is their own. To this end, managers
must offer better quality of working life and offer
opportunities to people to exploit their potential fully.
The focus should be on Human Resource
Development.

(Source: Rao, V.S.P. (2001). Human Resource Management. Excel Books. New
Delhi. P-12.)
 4

The table above shows the transmission of Personnel functions from one stage to
the other. In the initial eras labour was just regarded as the commodity to be
bought and sold by now in the emerging era the whole concept of labour has been
change, they are regarded as the most important resources of production i.e.
human resource. The main focus is to develop the human resources of the
organization.

A brief overview on some of the early advocates of the human resource

approach:

Robert Owen a successful Scottish businessman in the pre-scientific

management era, recognized the need for personnel practices and also applied
them during 1810 to1828 in a textile mill where he was a manager. He came up
with the amazing idea that treating workers better would actually increase
productivity and thus profits. Due to his courage and commitment to reduce the
suffering of the working class he is referred to the father of personnel
management.

F.W. Taylor. Frederick Winslow Taylor is regarded as the father of modern

management science. “Taylor's impact has been so great because he developed a
concept of work design, work measurement, production control and other
functions, that completely changed the nature of industry. Before scientific
management, such departments as work study, personnel maintenance and quality
control did not exist.” (www.accel-team.com, 2004).8

Henry L. Gantt gave a humanistic touch to management as he was much

concerned with the man behind the machine. He also emphasized on the need for
developing a harmonious cooperation between workers and management. He
strongly supported the recognition of human factor in management. In 1919, in
his book entitled “The Painting of the Ways” he urged management to a
philosophy of greater social concern. He improved Taylor's differential wage
payment system and brought out his task and bonus wage system.

Frank B. and Lillian M. Gilbreth. The ideas of Taylor were strongly supported
by a husband wife team of Frank and Lillian Gilberth who contributed a lot to
scientific management by studying job motions. Their main field of research was
on fatigue and motion studies. They focused on the ways to promote the
individual worker's welfare. He isolated the basic necessary movements from the
unnecessary motions which increased the productivity of his workers and reduced
fatigue. Frank Gilberth is regarded as a Father of Motion Study for the efforts
he made in the field of motion study. From his study he also concluded that
fatigue can be reduced by lightening the works load and introducing rest periods
in between of the work.
 5

Hugo Munsterberg. Hugo Munsterberg is considered as the “father of

industrial psychology” as he attempted to develop practical applications of
psychology in education, medicine, law and business. In 1909, Munsterberg
wrote an article named “Psychology and the Market” which covered the
topics which psychology could help contribute to: vocational guidance,
advertising, personal management, mental testing, employee motivation, and the
effects of fatigue and monotony on job performance.9
A. H. Maslow had developed a hierarchy of needs model in which he has
arranged the various human needs in a particular order from lower to higher.
Maslow in his theory stated that the people's needs vary from time to time and
its hierarchical in nature and to enter the higher order needs a person first has to
fulfill his minimum two basic needs.
Figure 1.1: MASLOW'S HIERARCHY OF NEEDS.

Self Actualization Needs

Esteem Needs

Basic Psychological Needs

Social Needs

Basic Psychological Needs

Douglas McGregor expounded the Theory X and Theory Y model of employee

motivation, which suggests that there are two different approaches of managing
workers. First is 'theory X' which assumes that people dislike the work and will
try to avoid doing it if possible, they are lazy in nature and should be controlled
and even punished if needed to achieve the organizational goals. Second theory is
 6

'theory Y' which assumes that employees are ambitious, inherently interested in
doing work, exercise self direction and self control, seek responsibilities and they
try to do work more creatively if provided with the chance do work more freely.
There was no need of punishment and control. After comparing both the theories
it was seen that the managers who used theory X got poor results while managers
who went with theory Y produced better results and performances.

After theory X there were several changes in business environment so McGregor

propounded theory Y which is based totally on humanistic approach. Both the
theories theory X and theory Y are still used as a motivational theory in any
enterprise.

1.3 OBJECTIVES OF HUMAN RESOURCE MANAGEMENT

The objectives of personnel administration are to accomplish maximum

individual development, desirable working relationships between employers and
employees and effective moulding of human resources as contrary to physical
resources.10

So the primary objective of HRM is to place right person at the right job and thus
attain the organizational goal more efficiently. Some of the primary objectives of
HRM are as:

• To help the organization to achieve its predetermined goals more

effectively and efficiently through well trained and well motivated
employees.

• To employ the skills and abilities of the workforce more expeditiously.

• To develop and maintain a quality of work life.

• To maintain ethical policies and behavior within and outside the

organization.

• To increase to the fullest the employee’s job and his self actualization
needs.
 7

1.4 IMPORTANCE OF HUMAN RESOURCE MANAGEMENT

HRM is important to an organization in a number of ways as:

• Good human resource practices help in attracting and retaining the best
person in the organization and offers excellent growth opportunities to
them to rise.
• Helps in appointing right person at right job and also encourages people
to work with more spirit and enthusiasm.
• Good HR practices benefits the society as well. Since it enables the
manager to get maximum output from minimum efforts and reduces the
cost of production. Thus the people consuming the commodity don’t have
to pay higher costs.
• HR Planning helps the organization to predict the type of people needed
in the short, medium and long run.

1.5 FUNCTIONS OF HUMAN RESOURCE MANAGEMENT

Functions performed by human resource management in an organization can be

understood easily by a diagram as below:

Figure 1.2: Human Resource Management

(Source: Khanka, S.S. (2003). Human Resource Management. S Chand &

Company Ltd. Delhi. P-6.)
 8

So with the help of above figure we can divide the HRM functions as -:

1.5.1 MANAGERIAL FUNCTIONS

1. PLANNING: Planning means looking ahead and sketching out future

courses of actions to be performed by an organization. It is a process for
achieving the predetermined objectives.

2. ORGANIZING: Organizing involves defining and grouping activities

along with the assignment of authority and responsibility among the
people of the organization in order to attain the common goals.

3. STAFFING: Staffing is related to the decisions and activities linked with

providing staff to an organization. It relates with acquiring, deploying and
retaining of a sufficient quality and quantity of workforce in order to run a
smooth and cooperative business.

4. DIRECTING / LEADING: Directing involves instructing, guiding and

supervising the performance of the workers to accomplish their objectives
as originally being planned.

5. CONTROLLING: Control consists of verifying whether everything

occurs in conformity with the plan adopted, the instructions issued, and
principles established. Controlling may be understood as a foreseeing
action which helps to check the errors and take corrective measures.

1.5.2 OPERVATIVE FUNCTIONS

1. PROCUREMENT: The first operative function of HRM is concerned

with procuring and employing the right kind of people in right number,
who possess necessary skills, aptitude and knowledge required to achieve
the organizational goals.

2. DEVELOPMENT: Development is a process of improving and

developing the knowledge, skills, creative ability, aptitudes and values of
employees so that they can fulfill the present and future organizational
requirements in an effective manner.

3. COMPENSATION: Compensation relates to that amount (monetary or

non-monetary) provided to the employees by their employers in exchange
of the services performed by them in an organization.
 9

4. INTEGRATION: Integration refers to motivating employees through

providing them job satisfaction and redressing their grievances through
proper means.

5. MAINTENANCE: It includes activities concerned with protecting and

preserving physical and mental health of an employee. It provides various
benefits and facilities to the employees regarding their physical and
psychological needs.

Some of the examples of HRM practices in large scale industries:

1.6 HUMAN RESOURCES MANAGEMENT PRACTICES IN

SAIL

Human Resource is one of the greatest assets for the Company. SAIL has
believed in the ideology of achieving excellence through investing in people and
technology simultaneously. Company continues to work for the development and
realization of best potential of its people. To promote motivational climate and
achieve growth, thrust on optimal utilization of manpower with focus on
improvement in productivity continued. Efforts were made for promoting better
employee participation. Steps were taken to make sure a smooth transition for
upcoming production facilities and preparations to work with a leaner workforce
for enhanced productivity. HR initiatives kept focus on building teams with wider
spectrum with reference to skill and knowledge.

During the fiscal 2009-10, all the five integrated steel plants recorded their best
ever labour productivity. An overall labour productivity of 226 Tonnes/man/year
was achieved by SAIL, with Bhilai Steel Plant touching a new peak at 340
T/man/year in Jan'10.Overall manpower figure at the year’ end was 1,16,950
(after 1585 employees of BRL joined SAIL family as a part of merger of BRL
with SAIL) comprising 15,704 executives and1,01,246 non-executives;
registering a net reduction of 5930, achieved by way of judicious recruitment,
redeployment strategies and multi-skilling.

Thrust continued on developing employees for a better role. Over 60 executives

at GM/DGM level were nominated to participate in Specialized/Advance
management programmes, conducted by Premier Management Institutes for
exposure to best business practices and leadership development. Overall, nearly
46,180 employees were trained during the year on different contemporary
technical and managerial modules; achieving level-1 of Performance Evaluation
Parameter under MOU with Government of India for the financial year 2009-10.
 10

Also, SAIL HR Excellence Awards initiated with IIM-Ahmedabad as the

knowledge and process partner with an objective to provide a platform to share
proven HR Practices /systems across the industry and thereby enrich our
knowledge in the field and spur new innovations.

Implementation of Presidential Directives on reservation for SC/STs

Presidential Directives on Scheduled Castes and Scheduled Tribes continued to

be implemented. As on 31st March 2010, out of total manpower 15.39% were SC
and 12.76% were ST.

During the year 2009, out of total recruitment of 594 made by SAIL, 136
candidates belonged to SC category and 40 candidates belonged to ST category.
Besides, Company has undertaken several initiatives for the socio-economic
development of SCs/STs and other weaker sections of the society, such as
providing free education, boarding, lodging and medical facilities to 128 SC/ST
students belonging to BPL families/primitive tribes, awarding 132 scholarships to
encourage meritorious and deserving SC/ST students and not charging tuition fee
from SC/ST students studying in the Company run schools.

Grievance Redressal Mechanism

Effective internal grievances redressal machinery exists in SAIL plants and units,
separately for executives and non-executives. Grievances in SAIL plants/units are
dealt in3 stages and employees are given an opportunity at every stage to raise
grievances relating to wage irregularities, working conditions, transfers, leave,
work assignments and welfare amenities etc. The system is comprehensive,
simple and flexible and has provide effective in promoting harmonious
relationship between employees and management.11

1.7 HUMAN RESOURCE MANAGEMANT PRACTIES IN

TATA STEEL

At Tata Steel, there is a continuous effort of staying in touch with employees to

ensure that there is the right culture to engage them in consistent performance
improvement. There are well-established and effective arrangements at each
business location for transparent communication and consultation with Works
Councils and Trade Union representatives. Further, the Company has always
registered steady quality improvement and productivity enhancement through
dedicated efforts of the Company’s Performance Improvement teams, focused on
 11

technical best practice transfer and the value of knowledge networks. Towards
the well-being of employees Tata Steel has put into practice many initiatives,
events and programmes that have helped to create not only an enduring loyalty
amongst employees but also enabled them to have a more fulfilled life.

Special Benefits provided for Employees-

Medical facilities: Free medical facilities for employees and their family, which
continues even after retirement.

Housing facilities: Subsidized electricity, water and housing facilities to all

employees.

Higher studies: Monetary incentives to employees acquiring higher

qualifications in a related field along with study leave, scholarships etc. when
necessary.

Holiday Homes: Tata Steel has five holiday homes for benefit of employees
during vacation.

Tata Steel Officers’ Beach Club: All officers of Tata Steel are eligible to be
members of the Beach Club that offers holidays in elite hospitality chains.

Family Benefit Scheme: In the tragic case of a fatality in the Works, a monthly
pension equal to the amount of the last drawn salary of the deceased is given to
the legal heir until the time the deceased would have attained the age of 60

Developing People

Valuing its people as a great asset, Tata Steel is committed to their development,
both in order to benefit the individual and to benefit the Company through
increased knowledge and skills. In order to leverage maximum potential of
human resource to achieve business objectives the Company recognises that
enrichment of people will help retain a motivated workforce in a competitive
environment.

Skills Development (Non-officers)

Skill training is a process that begins at the time of an employee joining the
company and continues throughout his or her career. Employees work in clusters
of multi-skilled workers and move across and within clusters on improving their
 12

skills levels. The Technical Training Institute imparts vocational and basic skills
training; the departments impart on-the-job training. In order to promote self-
directed learning, the Company has introduced e-learning whereby employees
can access electronic courses from their departmental e-Learning centers.

Skills Development (Officers) Tata Steel Management Development Centre

conducts a number of managerial and functional competency based programmes
for officers and supervisors.

The objectives of these programmes are:

i. To build individual capability by enhancing managerial and functional

competencies which are critical to operations, service and support
functions.

ii. To build a leadership pipeline in the organization to prepare the people to

meet the challenges of growth, globalisation and change.

Equal Opportunities Practices

Tata Steel is an equal opportunity employer and does not discriminate on the
basis of race, caste, religion, colour, ancestry, marital status, sex, age or
nationality. The Company’s Affirmative Action Policy promotes equal access to
its employment and opportunities and all decisions are merit based. Respect for
equal opportunities asset out in the Tata Code of Conduct is followed. The HR
Policy and Affirmative Action Policy are monitored by the Ethics Counsellor and
supported by an effective grievance redressal mechanism. Tata Steel encourages
female employees to advance their career with initiatives dedicated towards
personal development and professional advancement. The Women Empowerment
Cell examines and addresses the issues and concerns of female employees and
ensures that they do not miss out on any growth opportunity.

Freedom of association and collective bargaining

Tata Steel respects the employees’ right to exercise freedom of association and
collective bargaining and provides appropriate support for this. There is an
established system of joint working and collective bargaining, which ensures that
every employee is able to exercise this right without any fear. Pioneering the
concept in India, a system of Joint Consultation has been in place in Tata Steel
for more than 50 years.12
 13

1.8 OBSTACLES IN THE GROWTH OF HUMAN RESOURCE

MANAGEMENT IN INDIA:

There are various factors that have hindered the growth and development of
human resource management in India such as-:

1. As said by Peter Drucker, “the personnel manager tends to conceive his

job partly as a file clerk’s job, partly as a house-keeping job, partly as a
social worker’s job and partly as a fire-fighter to head off union trouble or
settle it.” It is clear from the above definition that the attitude towards
personnel/HR manager in India is still traditional and attitude of
employees towards the HR manager is not favourable.

2. HR department suffers from lack of interest among the personnel

executives due to lack of professional training and development facilities,
sense of insecurity, lack of job satisfaction etc.

3. Since HR administration is a line responsibility and staff function, so

personnel executives are not able to work properly and freely.

4. Due to the emergence and influence of powerful trade unions with their
selfish interests in many of the organizations, personnel officer keeps
himself away from any unnecessary disputes that may arise among the
employees and the organization.

5. HR profession is still not seen as a successful career like engineering or in

medicine, so it does not attracts many of the skilled and meritorious
persons. Mostly an average person with ordinary abilities can be found in
this post.

6. Materials provided by the educational institutions for management studies

are improper to compete with the changing environment. They still
provide the old-age curriculum which is not enough to deal with the
present rapidly changing conditions.

As the research is concerned with Century Pulp & Paper Mill, Lalkuan, so it
would be pertinent to give a brief history of Century Pulp & Paper Mill, Lalkuan:
 14

1.9 AN INTRODUCTION TO CENTURY PULP & PAPER

MILL LALKUAN(NAINITAL):

Century Pulp & Paper Mill (an ISO-9001:2000 & ISO-14001:2004 certified
division of Century Textiles and Industries Ltd.) is a member of B.K. Birla Group
of Companies leading in the integrated Pulp & paper plants. Mr. Basant Kumarji
Birla is the chairman of the company. The plant was established in the year 1984
in Lalkuan on the Bareilly-Nainital highway, 5km from Pantnagar towards
Haldwani. The Head Office of the company is at Kolkata. The Company is
pioneer in Bagasse based paper manufacturing throughout the country. It
presently operates in four fiber lines at the following installed capacity:

• Rayon Grade Pulp : 31320 TPA

• Writing & Printing Papers(Wood) : 37250 TPA

• Writing & Printing Papers(Bagasse) : 84600 TPA

• Writing & Printing Papers(DIP) : 75960 TPA

Main Raw-materials used by the company are Eucalyptus, Bamboo, Poplar and
Waste papers. The main aim of CPP is to manufacture international quality
products at optimum cost and meet consumer's need and satisfaction. Presently
company is exporting its paper to various countries including UAE, Singapore,
Sri-Lanka, Egypt, Bangladesh etc. The company has been awarded Golden status
by DGFT, Govt. of India as Golden Star Trading House at the corporate level.
The unit is ISO 9001:2004, ISO 14001:2004, OHSAS 18001:2007 and ISMS
(ISO 27001:2005) certified unit. The bagasse based papers are eco labeled.

Machinery Used : Most modern machinery with latest technology

Raw Material : Bamboo, Wood, Vineer Chips,

Bagasse , Waste Paper, Soft Wood Pulp

Products Manufactured : All types of Writing & printing Papers, Rayon Grade
Pulp, Tissue Paper & Packaging Board.

Permanent Staff & Workers : 798 + 2119 = 2917 (as on dated 1.10.2012)

Contractor Workmen : 3000 (Approx.)

 15

1.9.1 CPP PRODUCTS:

CPP range of products includes finest varieties of Writing & Printing Paper,
Industrial Papers, Speciality Papers, Security Papers and Copier Papers from
diversified range of raw materials.

Century Parchment, NCR Base, Overlay Tissue, Wax Match Tissue, Century
Index, MCIR Cheque Paper, Buff Pulp Board, Railway Bond, Azure-laid (Ivory),
MF Book Cover (UV Fiber), SS Maplitho, Super White Maplitho, Super Shine
Printing, Base Paper for Coating, Sticker Base Paper, Copier Paper 75 gsm (Eco
Mark) are some of the varieties that have wide range of applications.

CPP also manufactures high quality dissolving Rayon Grade Pulp, raw material
for viscose filament Yarn/staple fiber and bleached Hardwood Paper Grade Pulp.

Presently the following main plants are in existence within the campus:

W.P.P. PLANT

Integrated Pulp & Paper Unit based on Eucalyptus and Bamboo furnish. Two
Paper Machines with 115 TPD Capacity. Capable to manufacture 44-210
gsm(gm/sq.metre). Machine deckle is 2.69 meters. Rewinders are Jagenberg
make with 1000m/min speed and cutters are of 1.45m. width with 200m./min
speed.

R.G.P. PLANT

Based on Eucalyptus & Poplar furnish. Bleaching sequence includes Chlorine di-
oxide treatment. Sheeting M/c with 105TPD production with on machine cutters
and baling press. (Make Carcano, Italy make). M/c deckle 2.4 meters.

BAGASSE PLANT

Based on Bagasse furnish 84%, Eucalyptus and Bamboo 10% and imported Pulp
6%. Paper machine equipped with Film Press for on-line coating with 235 TPD
production. Capable to manufacture 40-120 gsm including light weight coated
varieties. M/c deckle 5.2 meters.
 16

RE CYCLE FIBRE PLANT

A second fiber based plant manufacturing writing printing paper. DIP plant is
equipped with two stage floatation and two-stage bleaching. Latest technology
incorporated in this plant facilitates production of finest paper quality in this
category. The product range includes writing and printing papers of 52-130 GSM.

TISSUE PLANT

Prime grade tissue plant of 100 TPD with hi-speed machine (2000MPM) supplied
by metro is equipped with latest technology to produce finest quality in this
category. The product range will include facial, napkin, toilet, C-fold, and kitchen
towel etc. in the range 13-40 GSM.

BOARD PLANT

Based on Wood & Waste paper, Voith Machine equipped with latest technology,
capable to produce 500 TPD finest quality Packaging Board with 600 MPM
speed. The product range includes 4 layer board of 170 to 500 GSM, M/C Deckle
is 3.75 Mtr.

POWER BLOCK

Power houses has 9 coal & pith fired boilers and three turbines. The turbines are
of 6.8 MW BHEL TG Set (extraction back pressure), 21 MW TDK TG Set and
16 MW BHEL Turbine, 43 MW TG Set (All are Double extraction condensing
type). 8 boilers are fluidized bed boilers out of which, 1 F.B.C. Boiler is of 100
T/hr, 62 kg/cm2, 480 degree Celsius, 3 F.B.C. Boilers are of 23 T/hr, 47 ata, 420
degree Celsius each and 2 F.B.C. Boilers are of 50 T/hr, 63 ata, 480 degree
Celsius each, 1 boiler is spreader stoker coal fired boiler of 25 T/hr, 47 ata, 420
degree Celsius and 1 boiler is coal cum pith fired boiler of 60 T/hr, 66 ata, 485
degree Celsius, 1 new coal boiler of 100 T/hr, 65 Kg/ Cm2, 480 degree Celsius.

CHEMICAL RECOVERY PLANT

Chemical Recovery Plant recovers cooking chemicals spent during cooking

operation in digesters with the help of latest technology available. These
chemicals are reused in cooking operation in Pulp Mill. The liquor received from
Pulp Mill is called Black Liquor and the liquor supplied back to Pulp Mill is
called White Liquor based on their colour appearance. The Black liquor contains
substantial quantity of organic matter like lignin which when burnt in Recovery
 17

Boiler along with Black liquor releases enormous amount of heat which is
utilized to generate high pressure steam and is sent to turbines to generate power.
The black liquor is first concentrated in Evaporators, then burnt in Boilers and
thereafter is reacted with Lime (Calcium oxide) in Causticizing section to finally
recover the spent chemicals. Make-up sulphur and lime stone are added in the
system as per requirement. Lime is produced in Rotary Lime Kilns by burning
the mud (Calcium Carbonate) obtained from Causticizing Section.

1.9.2 Commitment to Quality and Service

At Century quality is an all-pervasive commitment. It strive to continually

improve the quality of its products and services, which has been, affirmed in the
form of ISO 9001:2008 certification to the company for its Quality Management
System. The company has been responsive to the changing market requirement
and has developed new quality products to care to the varying end uses.

Power Block

Power House has 8 coal fired boilers and 3 turbines. The turbines are of 6.8 MW
BHEL TG Set (Extraction Back Pressure), 21 MW TDK TG Set (Double
Extraction condensing Type) and 16 MW BHEL Turbine.

6 Boilers are Fluidized Bed Boilers out of which one F.B.C. Boiler is of 100 T/hr,
62 kg/cm, 480°C, 3 F.B.C. Boilers are of 23 T/hr, 47 ata, 420°C each and 2
F.B.C. Boilers are of 50 T/hr, 63 ata, 480°C each, 1 Boiler is Spreader Stroke
Coal Fired Boiler of 25 T/hr, 47 ata, 420°C and 1 boiler is Pith Fired Boiler of 60
T/hr, 66 ata, 485°C.

1.9.3 ABOUT WORKFORCE IN CPP

Total Workforce in CPP - 2919

Classification of Workmen

• Permanent Workers - 2117

• Permanent Staff - 802

Categorization of Staff

• Graded Staff - 135

• Non Graded Staff-includes executives- 667
 18

Table 1.2: Shifts and Timings in CPP

(Approx 3000 Contractual workmen are also engaged on different temporary or
casual jobs.)

SHIFT TIMINGS No. OF NO. OF TOTAL

WORKERS STAFF

A 6AM TO 2PM 496 116 612

B 2PM TO 10AM 522 137 659

C 10PM TO 6AM 471 104 575

D 8AM TO 5PM 628 445 1071

TOTAL 2117 802 2919

(Source : Century Pulp & Paper Mill, Lalkuan)

Main Departments in CPP-

• Process Department

• Maintenance Department

• Electrical Department

• Instrumental Department

• Project Department

• ETP/WTP Department

• Personnel & Administration Department

• Finance Department

• Sales & Excise Department

• Purchase & Stores Department

• Raw Material

• RGP Lab, WPP, QC & Research & Development Labs

1.9.4 PRODUCTS AND TYPES OF PRODUCTS

Century Pulp and Paper Mill was established in 1984 with an installed capacity of
20000 TPA of writing printing paper and 20000 TPA of Rayon Grade Pulp,
 19

37250 TPA paper (Wood based plant) and 84600 TPA paper bagasse based plant.
Today the company is pioneer in bagasse based paper manufacturing throughout
the country. Company has established its brand equity against stiff competition
from other manufacturers. There is more competition in Bagasse and Wood based
paper.

The products manufactured by CPP (as in ANNEXURE 1)

1.9.5 PROCESS DESCRIPTION:

The company has four streets of production viz. W.P.P., Bagasse &
Recycled Fiber & R.G.P. Streets. A wide variety of writing and printing
paper is manufactured in W.P.P., Bagasse & Recycled Fiber Streets and
Rayon grade pulp is manufactured in R.G.P. Streets.

The main steps in manufacturing Paper / Rayon grade pulp are as follows:

• Chipping of the logs of Bamboo, Eucalyptus / Poplar in W.P.P. Street and

Eucalyptus in R.G.P. Street to about 1" size chips and storage in chips
silo.

• Bagasse unloading, handling, depithing, pile building, reclaiming and

washing in bagasse street.

• Cooking – Sulphate process: In WPP and RGP streets, vertical Batch

Digesters (for chips cooking) &in bagasse street, continuous Tube type
digesters (for bagasse fiber cooking) are in operation. The cooking
process is carried out at present temperature and pressure in presence of
cooking / chemicals for specified cooking period.

• Removal of Knots / uncooked / partially cooked portion of the material

obtained from digesters on the knotters.

• Washing of the pulp in brown stock washers to remove spent chemicals

and organic matter.

• Screening and cleaning of the pulp to remove impurities.

• Bleaching of the pulp based on the latest technology to attain final pulp
brightness as per requirement.

• Sizing and loading of pulp stock in the stock preparation section to

achieve desired qualities in final product.
 20

• Paper sheet formation in Paper Machines (WPP & Bagasse Streets)

equipped for online quality products.

• Pulp sheet formation in Sheeting machine in RGP street equipped for on

line quality products.

1.9.6 HUMAN RESOURCE MANAGEMENT IN CPP – At a Glance:

To achieve organizational goal is the ultimate aim of every organization, whether

small, medium or large in scale. So, Keeping in view the large size, large no. of
departments and large workforce of the mill the personnel department of CPP
manages the work in such a way so that the company may run smoothly and
systematically.

Responsibilities in the mill are so divided that all the sections receive direction
from the HOD i.e. V.P. (Personnel & Administration Department). All related
information, feedback and reporting is carried by sectional heads to V.P. Thus it
can be observed that there is a strong coordination and good team work between
the different sections of the P & A department.

Work undertaken by different departments in CPP

1. PERSONNEL: Recruitment, Transfer, Promotion, Punishment, I.R.

(Grievance handling, Disciplinary actions, Domestic enquiry, Court case,
Negotiations with trade unions, Agreement). All Welfare activities,
Maintaining personnel files, dealing with local authorities, Govt. officials,
Local leaders, Policy making & implementation of labour laws with
correspondence on related matters.

2. SECURITY: To abide by law & order and maintain discipline and

Harmony. To check unauthorized entries of man and materials, Gate
control, checking of vehicles, visitors & employees at gate to control
theft, unauthorized outing of employees etc, posting of security persons at
specified areas or spots to control sabotage & miss-happening, patrolling
day and night to avoid theft or airy oilier unhealthy acts. Managing entries
of incoming and outgoing materials.

3. TIME OFFICE: Time and Wages management- Record of day to day

shift wise attendance, leave record, O.T. Record, preparation of salary &
wages, leave encashment, Bonus & Gratuity payment, Full & final
payments.
 21

Managing casuals or supply labour as per the demand of different wages

& O.T. Distribution.

4. LIAISON & LEGAL: Excluding industrial disputes all legal matters

(like Transportation, Railways, Raw-materials etc.) coordinated by this
section.

Liaison with different departments (Private & Govt.) or officials to make

easier the company's work.

5. ADMINISTRATION: Monitoring & Controlling the contractors and

their workers activities specially- attendance, payment of wages,
minimum wages, accidents.

ESI, PF, contribution and deposition of these contributions to concern

Govt. offices.

6. HUMAN RESOURCE DEPARTMENT:

• Induction & Orientation of new entrants.

• Training & Development activities.

• Performance Appraisal (Coordinating the system as per Company's Policy

and approved procedure).

• HRD climate survey to reviewing / revising HR policies.

• Community Development activities.

• Coordination of TPM, ISO-9001, 14001, OHSAS 18001, ISMS 27001

activities.

• Managing visits and summer training time to time.

7. SAFETY: Goal- “0 (Zero) percent Accident”

• Identifying unsafe conditions & Acts. Create awareness among all

employees regarding risks, safety measures, uses of safety equipments &
personal protective equipments.

• Regular training in house & on the job to aware the contractors labour
about safety.

• Regular safety patrolling, implement work permit system.

• Monitoring and testing arrangements of pressure vessels, Hoists, pullips,
chains etc on specified intervals.
 22

• Maintaining fire tenders, safety equipments fire hydrants, fire

extinguishers etc.

• Safety credits and compliances of different acts & rules.

Table 1.3: HRD DEPARTMENT IN CPP

S.NO. ACTIVITY OBJECTIVE

1 Training & Development Behavioral/Skill enhancement.
2 TPM Minimize cost of quality/maintenance.
3 Appraisals Measurement of performance.
4 Quality circle Problem-solving, Team Building and
skill development.
5 Suggestions Participation in management.
6 Kaizens Loss Eliminations/Improvements.
7 HRD Climate Survey Identifying strengths and weaknesses.
8 Quality Management System Improvement in process, consistent
product quality.
9 Safety Day, Electrical Safety Motivation of work force.
Day & House Keeping
Shields
10 OHS AS-18001 To achieve safe and healthy
environment.
11 EMS Environment protection.
12 Library Building a learning organization,
strengthening intellectual capital.
13 Community Development Goodwill for the organization eases
meeting organizational objectives.
(Source : Century Pulp & Paper Mill, Lalkuan)

(Organizational Hierarchy of CPP and its employees is shown in ANNEXURE 2)

In an organization whether small or large in size, it’s the human/people who carry
out many important activities related to work. Therefore, the most important task
of management becomes to organize them, so that they can perform their work
more effectively and efficiently. Human Resource Management is a function
which focuses on recruiting, managing and directing human resources or
 23

employees, those who work within the organization. It suggests the management
to strategically manage people as business resources and to deal with the issues
related to them such as recruitment, compensation, safety, motivation, training,
administration etc. HR professionals advise managers and supervisors to assign
employees to different roles in the organization, in order to make them
successfully adapt to its environment. They also suggest strategies to increase
employees’ commitment towards the organization. Effective HRM aims at
motivating employees to contribute effectively and productively to the
accomplishment of company’s goals and objectives. The various functions of
HRM like planning, organizing, directing, staffing etc should be handled in an
organized way to achieve success.

As the size of an organization grows larger and its technology becomes more
complex, it also becomes progressively difficult to deal and coordinate with the
people within that organization. It is impossible for an individual person to watch
each and every person doing their work. In such case, need of a well trained and
experienced HR Department arises. Since, a well trained and experienced HR
Department helps the organization to make use of its human resources in a much
better and effective way. It not only helps the management to hire a required
talent but also helps the hired employee to grow and stay committed for a long
run in the organization.

1.10 METHODOLOGY USED:

Broadly speaking there are two sources for collection of statistical data i.e.
Primary or internal and Secondary or external. Primary data is basically collected
from within the organization and are complied in basic records of the institution.
They are first hand information collected directly from the source. These data are
original and raw in form. Therefore is said to be the crude form of information.
The investigator himself collects the data or supervises its collection through
samples, census or from case studies. On the other hand secondary data are
second hand information, collected and processed by some other agency or
institute like any Government agencies, any office, magazine, journals, pamphlets
etc. and are not used first time.

The methodology used for this research is based on primary and secondary data,
where the primary data is collected through Questionnaires cum Schedules.
Questionnaire is a research instrument consisting of a set of carefully designed
 24

series of questions in exactly the same form given to the group of people for the
purpose of gathering the information from the respondents in order to collect data
about some topic in which the researcher is interested. Questionnaires help in
collection of appropriate data having standardized answers which are easy to be
compiled in the cheapest way. Schedule is a set of questions structured on a given
topic which guides an investigator or the researcher. It is a guideline for
investigation. It contains direct questions as well as questions in the tabular form
presented for a specific purpose for testing an assumption or hypothesis. Sample
size took by the researcher for the collection of primary data for the study is:

No. of Executives questioned in CPP – 10

No. of Skilled Employees questioned in CPP – 100

No. of Unskilled Employees questioned in CPP – 100

Secondary data was obtained from the HRD Department of CPP. Questionnaires
cum schedules used by the researcher for this study are enclosed herewith at the
back of the annexure of the thesis.

Data collected through the questionnaires in the raw form was changed into
percentile form and through the percentages obtained different conclusions were
drawn by the researcher. Change of the feedbacks into percentage was as:

1. Very True 76% - 100%

2. True 51% - 75%
3. Partly True 26% - 50%
4. Not True 0% - 25%
To analyse the data various books written by different authors such as C R
Kothari, S.P Singh, Mohan Singhal etc were consulted by the researcher.

1.11 LITERATURE REVIEW:

Till now various works have been done in the study of Human Resource Practices
in various large scale industries but no such work is been done on this field in
Century Pulp & Paper Mill, Lalkuan. Here I would like to present literature of
some of the relevant studies being done by the different researchers in the area of
Human Resource Management and the related aspects.
 25

Chakrabarty (1978)13 in his study on “Personnel Management in Consumer

Cooperatives” observed that nepotism and favoritism are still the main hurdles in
the field of personnel management, especially in recruitment and selection.

Appa Rao (1988)14 in his study on “Personnel Management in Small Industry”

has examined the personnel management policies and practices in Indian small
scale industries and pointed out the deficiencies there in. He has suggested
measures for improving personnel management policies and practices in small
scale sector.

Roback (1989)15 has reviewed the literature in the field of human resource
management and development, with emphasis on training and evaluation, career
development systems and management, and discipline. Particular research
patterns focusing on public personnel perspectives have been emphasized and
analyzed.

Khurshid Khurana16 carried out a study on “Human Resource Development

Practices in Large Scale Industries in the Pune Metropolitan Region”. His
findings reveal that large scale industries in Pune do follow certain logical
procedures for human resource practices.

Ranga Rao (2000)17, in his article, has suggested that the success of any
organization depends on how it utilizes the resources and how effectively it
satisfies the customer requirements. He pointed out that there should be a balance
between cost and quality of the product and this can be achieved through the
effectiveness in utilization of resources and by eliminating the non-value added
activities.

Vara Prasad18 in his article on “HR Practices and Business Performance,” has
discussed that organizations can gain competitive advantage by implementing
successful HR Practices. Such practices consistently generate attentiveness on the
part of employees to attain business goals in the best possible and ethical manner.
He also stated that the use of HR practices contribute to enhance employee
commitment and is in turn linked to higher levels of productivity and quality of
services.
 26

1.12 CONSTRAINTS:

1. Executives and skilled as well as unskilled workers were not ready to give
the answers of questions being asked to them. They were not so
cooperative.

2. Some of the unskilled workers were not aware of the questions being
asked to them and were feeling shy to give the answers.

1.13 CONCLUSION:

Thus it can be concluded that Human Resource Management makes the most
effective and efficient use of human resources in order to achieve the
predetermined goals successfully. HRM is not a very recent concept but many of
the well known philosophers and thinkers such as L.S. Hsu, Adam Smith, F. W.
Taylor, Henry Fayol, Robert Owen etc have been giving their precious views in
regard of the topic. For example Robert Owen came up with the idea of treating
workers better in order to increase their efficiency, Henry L. Gantt strongly
supported the recognition of human factor in management, Maslow’s hierarchy
of needs presented the various human needs in a particular order etc. HRM is
very important for all the organizations since it enables the managers to achieve
maximum out of the minimum and hence have the optimum utilization of the
resources.HRM includes various managerial and operative functions which help
the organization to survive for the long run.

Century Pulp & Paper Mill, one of the biggest mill was set up in Uttarakhand in
the year 1984, which manufactures the bagasse based paper throughout the
country. There are many plants existing within the campus dealing in different
varieties. The total work force in CPP is approx 2919. Out of which some
workers are skilled and basically form the permanent staff while some are
unskilled and are appointed on the contract basis. The Human Resource
Department in CPP is being divided into different departments according to their
activities such as Training & Development, Quality Circle, Safety etc.
 27

REFERENCES:

1. Quoted by Gupta, C.B. (2002). Human Resource Management. Sultan

Chand & Sons. New Delhi. P-13.

2. Khanka, S.S. (2003). Human Resource Management. S Chand &

Company Ltd. Delhi. P-2.

3. Edwin, B.Flippo. (1984). Personnel Management. Mc-Graw Hill. New

York. P-5.

4. Megginson, Leon.C.(1977). Personnel and Human Resource

Administration”. Richard, D.Irwin, Homewood Illinois. P-46.

5. Michael, V.P. (2001). Human Resource Management and Human

Relations. Himalaya Publishing House. Mumbai. P-30.

6. Ghanekar, Anjali. (2000). Human Resource Management (Managing

Personnel the HRD Way). Everest Publishing House. Pune. P-12. (Source:
Owen Robert. A New View of Society. 1913)

7. Michael, V.P. (1992). Management for managers. Himalaya Publishing

House. Mumbai. P-2.

8. http://www.scribd.com/doc/23267475/Principles-of-Management-and-
Organisation-Behaviour P-15

9. http://www.scribd.com/doc/30457447/Principles-of-Management-
Lecture-Notes-for-MBA

10. Scott, S.D. Clothier, R.C. Mathewson, S.B. and Spriegel, W.R. (1949).
Personnel Management. McGraw Hill. New York. P-23.

11. http://www.indiainfoline.com/Markets/Company/Fundamentals/Directors
-Report/Steel-Authority-of-India-Ltd/500113

12. http://www.scribd.com/doc/47902364/HR-Practices-in-Manufacturing-
Industry

13. Chakrabarthy, M.N. (Sept 1978). Personnel Management- A New

Concept, Indian Consumer Co-operator. New Delhi. P 9-10

14. Appa Rao, P.B. (1998). Personnel Management in Small Scale Industries.
Deep & Deep Publications. New Delhi.
 28

15. Roback, Thomas. H.(1989). Personnel Research Perspectives on Human

Resource Management Development, Public Personnel Management. Vol.
18(2). P 138-161.

16. Khurana Khurshid. (Feb 1997). Human Resource Development in Large

Scale Industries in Pune Metropolitan Region.

17. Devala Ranga Rao. (Jan 2000). Manpower Assessment of Service

Department Using Functional Analysis Approach. Industrial Engineering
Journal. Vol. XXIX. No.1. P 18-25.

18. S.V.V.S. Vara Prasad. (May 2007). HR Practices and Business

Performance. HRM Review.

*******
 29

Chapter 2

HUMAN RESOURCE PLANNING

Manpower planning is reputed to have first been introduced in 1676, when

Samuel Pepys first became concerned with the provision of careers for officers in
the Royal Navy. Perhaps the Chinese had the problem of manpower planning as
was evident from a Seventh Century B.C. Chinese adage (Kuan Chung Tzu):
“If you wish to plan for a year sow seeds
If you wish to plan for ten years plant trees
If you wish to plan for a life-time develop men.”1

Human resource planning is a process of determining and assuming that the

organization will have an adequate number of qualified persons, available at the
proper times, performing jobs which meet the needs of enterprise and which
provide satisfaction for the individuals involved.2

The success of any organization depends largely on the quality and quantity of its
human resources. Since, there is always a scarcity of suitable persons, the
organization needs to plan for the same. To find out the right man for the right
job and develop him into an effective team member is an important task of every
manager. Only human resources have the capability of producing the output that
is greater than the input, so its proper management is very necessary. Manpower
planning is the process of determining manpower requirements and the means for
meeting those requirements in order to carry out the integrated plan of the
organization.3

2.1 NEED OF HUMAN RESOURCE PLANNING:

1. Assessing human Resource Needs – HR planning is required to

determine whether there is any shortage or surplus of the employees in an
organization as both the conditions can affect the work adversely. HR
planning ensures the employment of proper workforce in an organization.
2. Coping with the changes within as well as outside the organization – It
enables an organization to cope up with the changes in market,
technologies, products, government regulations etc.
3. Replacement of Persons – HRP is essential because of the frequent
labour turnover due to voluntary quits, deaths, retirements, promotions,
marriages etc, which are unavoidable.
 30

4. During Expansion – In order to meet the needs of expansion program

HRP is needed.
5. Scarcity of capable human resources – Despite of abundance of human
resources and growing unemployment its very tough to recruit skillful,
qualified and capable workforce. Hence the need of HRP arises.
6. Increasing investments in human resources – Human resources are the
valuable assets of an organization so an organization makes investment on
them through training or job assignments. To invest in an employee needs
a thorough planning.
7. To make the programs of employees development – HRP helps in
determining abilities of the future recruited employees and helps in
estimating the need to train them. So effective programs may be prepared
on that basis for the development of employees.
8. Reduction in cost of production – Helps in recruitment of the best
workers and hence reduces the rate of labour turnover. It also minimizes
the wastage of the enterprise and hence helps the management in
maximum exploitation of the resources of enterprise.

2.2 FORMS OF HUMAN RESOURCE PLANNING:

There can be two forms of Human Resource Planning-

I. Short Term Human Resource Planning: Short-term planning means to

prepare the plans for staffing needs in the near future and is concerned
with all jobs and persons. It looks after fulfilling future vacancies. It
mainly involves with being aware of what positions need to be filled and
who among the existing workforce is available to fill those positions.

II. Long Term human Resource Planning: Long-term human resource

planning relates with planning of human resources for more than two
years as it is one of the most important tasks faced by companies that
want to survive for a long time period. It is concerned with matching the
complete list of employees to total job requirements.

2.3 HUMAN RESOURCE PLANNING PROCESS:

1. Analyzing organizational Plans: The first step in Human Resource

Planning is to analyze the objectives and strategic plans of the company.
Plans concerned with the technology, production, marketing, finance,
expansion and diversification give an idea related to the future work
activities.
 31

2. HR Demand Forecast: Demand forecasting is the process of estimating

the number and type of personnel required in future. The number of
people needed in future depends on the production and sales of an
enterprise. But this demand keeps on varying due to change in production
technology, process, make or buy decisions, behavior patterns, control
systems etc. and demand forecasting helps in making projections for new
positions to be created and vacancies arising in current manpower. There
are several good reasons to conduct demand forecasting.4 Forecasting
techniques differ for different organization. They may be simple or may
be sophisticated. Organizations generally follow more than one technique.
The different techniques are as:

Figure 2.1: Techniques of HR Demand Forecasting

Managerial Ratio Trend Regression

Judgment Analysis Analysis

HR
Demand
Forecast

Work Study Delphi Flow

Techniques Technique Models

Others

(Source: Aswathappa, K. (5th Edition). Human Resource and Personnel

Management text and cases. Tata Mc Graw Hill Publishing Co. ltd. New Delhi.
P-84.)

A. Managerial Judgement: Managerial Judgement technique is the most

typical method of forecasting generally used in small scale organizations.
It involves two types of approaches i.e. 'bottom-up' approach and 'top-
down' approach. Perhaps the best way of managerial judgement method is
to use both the approaches 'bottom-up' and 'top-down' together.
 32

Table 2.1: Staff Forecast Form

Category of Staff…………………………………………
Year……………………………
Staff Members and No. of Staff Remarks
Movements to be
Provided
1. Number of staff at 1.1 Age Groups
(excluding known 75 Under 25 30
resignations) 25-34 20
35-44 15
45 and over 10

2. (a) Expected retirements, (dates to be specified)

transfers out and
promotions during year 8
(b) Less expected transfers
in,
3 5
promotions and new
appointments already made
3. (a) Number of Staff Increase in number to
required on 1 January, be substantiated by
next year 80 O&M report
(b) Less present Staff 75 5
4. Expected staff losses due Estimated by age groups
to Under 25 12
normal wastage of existing 15 15 25-34 2
staff 35-44 1
45 and over -
5. Expected losses of staff Short service staff turnover
to be recruited in the period 5 5 at 20% of 25 (events
2+3+4 above)
6. Total staff to be provided 5 to be recruited by 1
during the period 30 February, others to be
programmed later
(Source: Table based on A Handbook of personnel Management Practices by
Michael Armstrong PP-208)

The table 2.1 shows an example of the staff forecast in an enterprise. The total
number of staff, number of expected retirements, transfers and promotions are
 33

calculated along with the unexpected vacancies created due to death, resignation
or any other uncertain accidents. With the difference of these staff forecast is
made.

B. Work Study Method: Work study method also known as work load
analysis is suitable where it is possible to apply work measurement to
calculate how long operations should take and the amount of labour
required. Under this method total production and activities for a specific
period are estimated and this estimation is translated into number of man-
hours required to produce per units (after taking the capability of
workforce into consideration).

C. Ratio-Trend Analysis: This is the quickest forecasting technique in which

manpower resources are estimated on the basis of production level and
number of workers available. The technique involves studying past ratios
between, say, the number of direct and indirect workers in an organization
and forecasting future ratios after making allowances for changes in the
organization or its methods. The forecasts are then used to determine
direct labour requirements and the forecast ratios of indirect and direct
labour is further used to calculate the number of indirect workers needed.
The technique can be made more clear through an example as:

Table 2.2: Demand Forecast – Inspectors

Year No. of Employees Ratio

Inspector:Production

-3 1500 150 1:10

Actual -2 1800 180 1:10

Last year 2000 180 1:11

Next year 2200* 200** 1:11

'+2 2500* 210** 1:12

'+3 2750 230** 1:12

(Source: http://www.egyankosh.ac.in/bitstream/123456789/35578/1/Unit-3.pdf.
P-36.)
 34

The table above shows how an analysis of actual and forecast ratios, between the
number of routine proposals to be processed by an insurance company's
underwriting department and the number of underwriters employed could be used
to forecast future requirements.

D. Flow models: Flow models are very frequently associated with

forecasting personnel needs. The simplest one is called the Markov
model. In this technique, the forecasters will:5

1. Determine the time that should be covered. Shorter lengths of time are
generally more accurate than longer ones. However, the time horizon
depends on the length of the HR plan which, in turn, is determined by the
strategic plan of the organization.

2. Establish categories, also called states, to which employees can be

assigned. These categories must not overlap and must take into account
every possible category to which an individual can be assigned. The
number of states can neither be too large nor too small.

3. Count annual movements (also called ‘flows’) among states for several
time periods. These states are defined as absorbing (gains or losses to the
company) or non-absorbing (change in position levels or employment
status). Losses include death or disability, absences, resignations and
retirements. Gains include hiring, rehiring, transfer and movement by
position level.

4. Estimate the probability of transitions from one state to another based on

past trends. Demand is a function of replacing those who make a
transition.

E. Regression Analysis: This technique is similar to Ratio-trend Analysis as

is based on the relationship between sales volume and employees size. It
can be used to assess the relationship between one or more independent
and the dependent variable. It determines the relationship between Y
variables such as number of employees and X variables such as work
done by actually measuring the relationship that existed in the past.
Multiple regression analysis involves two or more independent variables
and is more advanced but most accurate forecasting technique when used
correctly.
 35

Figure 2.2: Regression Line Showing Relationship Between Sales and

Employees Size

(Source: Aswathappa, K. (5th Edition). Human Resource and Personnel

Management text and cases. Tata Mc Graw Hill Publishing Co. ltd. New Delhi.
P-86.)

After observing the regression line in the figure above one can find out the
number of employees required at each volume of sales.

F. Delphi Technique: Delphi Technique named after the ancient Greek

Oracle at the city of Delphi, is an important technique used for estimating
demand of human resources. It takes into consideration human resource
requirements given by a group of experts instead of traditional group
meetings. The administrator recruits around five to twenty suitable
experts and poll them for their forecasts and reasons to forecast. The
experts then collects the manpower needs, summarises the various
responses and prepares a report. The process is repeated until all experts
agree on estimated personnel needs.
 36

CASE STUDY: DEMAND FORECASTING TECHNIQUE IN LARSEN &

TOUBRO
It is India's largest engineering and construction conglomerate with additional
interests in IT and electrical business. A strong, customer-focused approach and
the constant quest for top-class quality have enabled the Company to attain and
sustain leadership position for over six decades.

L&T follows ‘bottom up’ of management judgement and work study techniques
for demand forecasting. Forecasting process in L&T begins during November of
every year. The department heads prepare their personnel estimates (based on
details of production budget supplied to them) and submit the estimates to the
respective personnel mangers (L&T has 11 plants in our country). The personnel
heads will review the estimates with the departmental heads and will send final
reports to the Mumbai office where a centralized HR department is located.
Estimates are reviewed by the HR department and final figures are made known
to those personnel managers who initiate steps to hire the required number of
people in the following year. The forecast is made for a quinquennium, but is
broken down to yearly requirements.6

3. Forecasting Supply of Human Resources: After forecasting human

resource demand the next step in human resource planning is to forecast
supply of human resources. The purpose of HR supply is to deal with the
quantity and quality of the people available. To forecast the availability of
the human resource both internal as well as external supplies are considered.

• Internal Labour Supply: While estimating internal supply it may be

considered that internal labour force may be effected by temporary
absences such as leaves of absence (e.g., educational leave,
maternity/paternity leave), permanent absences (e.g., death, disability,
retirement), or turnover (e.g., resignations, dismissals, layoffs). Death,
disability, and retirement are considered actuarial losses in that these are
life events that affect all populations. These can be predicted with some
degree of accuracy by using mortality rates, understanding occupational
health and safety risks, or reviewing demographic information about the
population. Turnover refers to the termination of an individual’s
employment with an organization.7
 37

Figure 2.3: Estimating Internal Labour Supply for a Given Unit

(Source: http://www.whatishumanresource.com/hr-supply-forecasting. P-35. )

• External labour Supply: As the organization grows & diversifies and is

not able to find the people internally to fill the vacant positions, it has to
tap into the external market. If the organization is able to fulfill its
external recruitment needs according to the possible sources of supply
keeping the market trends in mind its problem to find the potential
personnel at the required time will become easy.

4. Matching Demand And Supply: Once the demand and supply forecasts of
human resources in an organization is completed the HRD manager compares the
two forecasts. This comparison helps in calculating the surplus or shortage of
human resources in future. In case there is no difference between the manpower
requirements and manpower supply, there is no need to take any action by the
HRD manager. And if the difference exists between the two the HRD manager
has to take actions accordingly. As in the case of shortage of human resource it
can be met by promotions, overtime, training & development to improve quality,
retention, hire staff from outside etc. On the other hand if there is surplus of
human resource it can be made good through voluntary retirement scheme
(VRS), termination, lay-off, retrenchment etc.
 38

Figure 2.4: Programme Planning Options

Hire new full time employees

Offer incentives for postponing retirement
If a shortage of employees is Re-Hire retired employees on part-time basis
expected Attempt to reduce turnover
Bring in overtime for present staff
Subcontract work to another employees
Hire temporary employees
Re-engineer to reduce needs

Do not replace employees who leave

Offer incentives for early retirement
Transfer to re-assign excess employees
If a surplus of employees is Use slack time for employees training or
expected equipment maintenance
Reduce work hours
Lay-off employees

(Source: Cynthia D. Fisher. et al. (1997). Human Resource Management.

Houghton Mifflin. P-114)

5. Monitoring and Control: Monitoring and Control is the fifth & final phase in
human resource planning process. Once the action plans are implemented there is
a need to review those plans and monitor them against the set standards. After the
plans and policies are monitored it will help in revealing out the deficiencies, if
any. So, corrective measures can be adopted to remove those deficiencies and
control the implementation of action plans in right direction. Monitoring and
control needs to be followed time to time as in changing business environment
action plans need to be modified accordingly.

2.4 JOB ANALYSIS AND JOB DESIGN

Job analysis is a systematic study of jobs to identify and determine in detail the
content of a job in terms of activities involved and attributes needed to perform
that work. It determines the relative information of the duties, skills,
responsibilities, and work environment of a particular job. The HR manager tries
to gather these information and identify what a job demands and what an
employee needs to possess to perform that work more effectively and efficiently.
 39

It is a process to put right person at right job on the basis of data collected on a
job.

Job analysis can be defined as the process of determining by observation and

study the tasks, which comprise the job, the methods and equipment used, and the
skills and attributes required for successful performance of the job.8

Job analysis is the process of getting information about jobs: specially, what the
worker does; how he gets it done; why he does it; skill, education and training
required; relationship to other jobs, physical demands; environmental conditions.9

Figure 2.5: Components of job analysis

Job Analysis

Job Description Job Evaluation

Job Specification

Job Description: A job description is a written statement of the appropriate and

authorized contents of a job. It is descriptive in nature and provides job related
information in terms of its title, location, duties and activities to be performed,
authority & responsibility, working conditions, tools and equipments used,
hazards of the job etc. It tells us what the job is to be done, why it will be done,
how it will be done, and under which condition. Thus job description
differentiates one job from other and describes duties and responsibilities of a
specific job.

Job Specification: Job specification describes the key qualifications necessary

for satisfactorily completion of the job. It is a written record of the physical,
mental, social and psychological and behavioral characteristics which a person
should possess in order to perform the job effectively. Physical characteristics
include height, weight, chest, vision, hearing, health, age, voice, poise, hand and
foot coordination etc. Mental characteristic consists of general intelligence,
memory, judgement, ability to concentrate, foresight etc. Social and
psychological characteristics comprise emotional stability, flexibility, personal
 40

appearance, pleasing manners, initiative, drive, conversational ability etc. Other

personal characteristics include sex, education, family background, job
experience, extra- curricular activities, hobbies, etc.10

In short we can say that job specification makes the selection process easy as it
sets the desired qualification of an individual needed for a specific job.

Job Evaluation: Job evaluation is a process of finding the relative worth of a job.
It determines how well a person handles the specific task given to him. As there
are various jobs within an organization, each of them are ranked in terms of their
importance on the basis of their contents. In this process jobs are ranked not the
jobholders. It serves as basis for grading different jobs and finally deciding the
suitable pay structure for them.

Methods of job evaluation-:

1. Ranking Method- It is the most simplest and common method used for
job evaluation. Under this method jobs are compared to each other based
on their overall worth to the organization and thus are arranged from
highest to lowest. The worth of the job can be calculated on the basis of
skills, education, difficulty level, physical & mental efforts, duties &
responsibilities, working conditions etc. The job at the top level has the
highest worth and job at the bottom has the lowest worth. Pay structure is
then calculated according to the worth of the job.

2. Grading Method- The other name of grading method is 'classification

method'. Under this method jobs are classified into different grades and
classes with relatively the same value to a business by an authorized body
or committee appointed for the task. The grades are created by using some
common denominators such as knowledge, skill, experience and
responsibilities (these denominators can be different for the different
organization). Once the grades and classes are established there is no
difficulty in fitting each job into its proper grade or class. Then at last
different wage rates are fixed for each grade

3. Point Rating- This is the most widely used method of job evaluation. It
makes quantitative evaluation of jobs by expressing them in terms of key
factors like skill, responsibilities, efforts and working conditions (as these
factors are common to all jobs). Then points are assigned to each factor in
 41

order of their importance eliminating bias at every stage. The points for
each factor are then summed up to determine the wage rate for the job.
The jobs with highest points are paid the highest pay. Similar rated groups
are placed in the same wage/salary grade.

4. Factor comparison Method- The method originally developed in 1926 is

a more systematic and scientific method of job evaluation. It is the
combination of both ranking method and point method as it rates the job
by comparing them as well as breaks jobs into key factors. Firstly the key
jobs are selected that represent the wage level across the organization.
Then the job is evaluated in terms of different factors such as skill,
physical & mental efforts, responsibilities, working conditions etc.
common to all jobs. After that the selected jobs are ranked accordingly
and with the money value assigned to each factor, wage rates are
determined for the key jobs. The last step of this method includes the
comparison and evaluation of remaining jobs in the organization.

Figure 2.6: Process of Job Analysis

Organizational Analysis

Using Job Analysis Information

Selecting Representative Jobs for Analysis

Responsibility for Collecting Information

Collection of Data

Preparing Job Description

Preparing Job Specification

 42

Steps involved in the process of Job Analysis-:

1. Organizational Analysis: First step in the process of jab analysis is to

obtain an overall view of various jobs in the organization in order to find
the linkages between jobs and the organizational goals, inter-relationships
between different jobs and contribution of various jobs in achieving
organizational efficiency and effectiveness.

2. Using job analysis information: The information generated by job

analysis can be used practically for all personnel functions but to avoid
complexities it is desirable to focus only on few priority areas to develop
clarity on the uses of information pertaining to job analysis.

3. Selecting representative jobs for analysis: It is not possible to analyze all

the jobs as it will be highly time consuming and costly process. It is
therefore desirable to pick up a representative sample of jobs for detailed
analysis.

4. Responsibility for collecting information: After finding out the job

information to be collected, it is necessary to decide who will be assigned
charge to collect the data. This person can be from outside or inside the
organization.

5. Collection of data: In this step data is collected on the characteristics of

the job and behavioral & personal attributes required to, do the job
effectively. These data may be collected from the employees actually
doing the job or from their supervisors.

6. Preparing job description: The information collected in the previous step

are now used to prepare a job description, which is a written statement
that highlights major tasks, duties and responsibilities needed for an
effective job performance.

7. Preparing job specification: In the last step of job analysis a job

specification is prepared for the employees. Job specification is a written
statement of personal attributes required in terms of education, skills,
training, experience required to perform a job.

Job Design: Job design is the next step after job analysis. Job analysis provides
data related to job and skill required by a job holder to perform that job. For a
better job performance job contents must be sequenced appropriately, which is
termed as job design. A well planned job design has a positive impact on both
 43

employees and the organization while a poor job design can affect the smooth
functioning of an organization as it may lead to boredom, reduced motivation,
increase in organizational costs etc.

Job design aims at determining the tasks to be done, how they can be done, and in
what order they are to be done. It involves integrating job responsibilities and
certain qualifications required to perform a task along with organizational &
individual employee requirements as well as working conditions. Job design
helps in attracting right person at the right job by making job look more
interesting and specialized. In short we can say that the main objective of job
design is to meet the requirements of organization and at the same time fulfill the
personal requirements of job holders.

2.5 PROBLEMS AND LIMITATIONS OF HUMAN

RESOURCE PLANNING:

In spite of many benefits and uses of human resource planning there are many
problems and limitations attached with it such as-

• It is a general thinking that if the people are available in abundance why

to spend money and time on them, which is one of the greatest yardsticks
in HRP.

• Due to the certain inherent limitations of forecasting in itself human

resource forecasting becomes tricky as well.

• Predictions with the reasonable degree of accuracy based on future

vacancies due to retirements, marriages, deaths and resignations can be
made. However its risky to take decisions on these predictions as these are
not specific enough.

• HR Planning requires wholehearted support of top management to be a

success.

• Human Resource Planning is based on data relating to human resource

which are not maintained in a proper way in some of the organization.
Hence, in the absence of these reliable data, process of HRP becomes
very difficult.

• HRP is an expensive and time consuming process. Employees in some of

the organization may resist it as according to them it may increase cost of
production.
 44

• HRP must be handled by an expert personnel which is not seen often.

Many HR personnels and specialists do not understand the whole HRP
process and in absence of this planning cannot be effective.

2.6 HUMAN RESOURCE INFORMATION SYSTEM (HRIS):

Human Resource Information System (HRIS), is a software or online solution for

small to mid-sized businesses for the data entry, data tracking and data
information needs of human resources to manage their HR Payroll, management
and accounting activities. HRIS is an integral part of the Management
Information System (MIS) which includes information related to assets, finance,
production, accounting, sales etc. A good HRIS must provide capability of
effectively planning and control in order to achieve efficiency and quality of HR
decision making and thus improving employee and managerial effectiveness and
productivity.

There are hundreds of companies present in the market who sell HRIS data base
each with different capabilities. So every organization has to pick its HRIS
carefully according to its need. The inputs of HRIS are the information related to
employees, their qualifications, skill, abilities, age, sex, pay scales, organizational
objectives, company related documents (like employee handbooks, safety
guidelines etc.) etc. An effective HRIS processes these input data and transforms
them into meaningful information. The company just needs to select a HRIS and
customize it to meet its needs. Thus, managers find it easy to manage human
resources in an organization with an appropriate HRIS. They can easily access
the information they need to effectively and efficiently support the success of
their reporting employees.

The main advantages of using HRIS are:

• It reduces the amount of paper and manual record keeping work.

• The information provided on human resources by HRIS is more accurate

and quicker.

• It is time saving and cheap device.

• It makes the analysis of HR issues more quickly.

• It establishes strong management control.

• It is easy to use and provides information available as and when desired.

 45

2.7 HR PRACTICES IN INDIA:

A comprehensive survey of human resource planning practices in 45 companies

covering cross section of the manufacturing industry (Krishnaswamy, Manpower
Planning Practices in Indian Manufacturing Organizations, ASCIJI of
management, 1985) has indicated the scant attention that is being paid to human
resource planning. Human resource specialists have pointed out the facts that
most Indian organizations do not have adequate records and information on
human resources. Proper retrieval systems also are not available in most cases.
The computerized personnel information systems unlike their counterparts in the
western world, do not play an important role in India. Even the current
technologies and knowledge in respect of manpower planning is not put to use
optimally. Such practices, inevitably lead to ineffective manpower planning.11

2.8 HUMAN RESOURCE PLANNING AND THE

GOVERNMENT
Manpower planning has come to be recognized in India as one of the adjuncts of
socio-economic planning since the early years of the planning era. Among the
noteworthy steps taken by the government of India in this direction is the setting
up of the Institute of Applied Manpower Research (IAMR). The IAMR was set
up in 1962, inter alia to conduct empirical research in manpower, to provide
advisory and consultancy services to government departments and industry and to
impart training in methods and techniques of manpower planning. Training is
now the major activity of the institute.12

2.9 HUMAN RESOURCE PLANNING IN CPP MILL, LAKUAN

Keeping in view above different components of Human Resource Planning, the
researcher has tried to focus the study regarding the Human Resource Planning in
Century Pulp and Paper Mill. The Human Resource Planning in CPP involves:

Manpower Planning where, a Parta (word taken from Marwari language) is

formed according to which further planning is done. Parta relates with planning
for future manpower needs based on location & number of the plants, its
geographical conditions and technological developments. The HR department
plans future manpower needs for the next 2-3 years taking in concern the number
of vacancies to be created due to retirement, sickness, promotion or transfers of
the current employees. The company collects the information regarding the
number of retirement of the employees in a particular year in different
departments and different posts. After analyzing the information they plan for the
 46

future sources of recruitment, i.e. internal or external. And if the vacancy is to be

filled internally, how would be the recruitment of the post vacant due to the
promotion or transfer and so on.

The company also prepares the employees for succession planning i.e. preparing
an employee to take place of other in case of any emergency, retirement,
promotion or transfers. The employee is selected in advance for this task and
sometimes given the opportunity of taking charges in case of short term needs
like the employee went on leave or is sick, the other employee gets chance to
know his work and responsibility. This helps the successor to perform his job in a
most effective and efficient manner.

Some of the questions related to the Human Resource Management Practices and
Human Resource Planning were asked to the executives, skilled and unskilled
workers of CPP and with the help of feedback so received the tables were formed
as follows:

Percentage taken for the answers are as-

5. Very True 76% - 100%
6. True 51% - 75%
7. Partly True 26% - 50%
8. Not True 0% - 25%

Table 2.3: Feedback of Executives on HR Planning in CPP

Questions Very True Partly Not

True True True
Clarity of Objectives 30% 70% Nil Nil
Clarity of Tasks 10% 90% Nil Nil
Inter-linkage with other 20% 80% Nil Nil
Departments
Organized & Qualified Staff 10% 90% Nil Nil
Identification of Manpower Needs 40% 30% 10% 20%
Attracting Qualified Employees 10% 60% 30% Nil
Same Recruitment Procedure Nil 50% 40% 10%
followed

The table above shows the feedback of executives employed in CPP. The
executives were asked whether the organizational objectives were clear to them
or not. Most of the executives gave answer as true. While 30% were fully sure
 47

about the organizational objectives. 90% of the executives were having the clear
view about the task to be carried out to achieve organizational goals while only
10% were very clear about the tasks. Executives when asked about whether the
HR department’s performances were interlinked with the other departments or
not, the feedback showed that 80% gave answer as true while 20% were very
true. The feedback table shows that only 10% executives are of the view that HR
department is well organized and properly staffed with well qualified
professionals while 90% say that it is up to 75% true.

Questions when asked about the identification of manpower needs in the

organization only 40% were very true regarding the question while 20% were not
true also. Executives when asked whether the HR department is able to attract the
qualified employees or not only 10% gave the answer as true while maximum of
the executives i.e. 60% gave the answer as true. The answer for the question that
whether the same recruitment procedure was being followed for all levels of
organization, no answer fell in the true category. 50% gave the answer as true,
40% partly true while 10% were not true also.

Hence, through the feedback above it can be concluded that the executives in
CPP are up to 75% sure about the clarity of objectives & tasks to be performed in
the organization and so is the case with the HR department’s inter linkage with
the other department. But the executives feel that the HR department is not very
much able to attract the qualified manpower for the organization as well as the
same recruitment procedure is also not very well followed in CPP.

Table 2.4: Feedback of Skilled Employees on HR Planning in CPP

Questions Very True Partly Not

True True True
Clarity of Objectives 80% 19% 1% Nil

Working for Welfare of Employees 74% 24% 1% 1%

Accessibility of Services 57% 39% 4% Nil

Opportunities provided to Internal 45% 34% 19% 2%

Applicants

Non biased Interview Techniques 56% 35% 9% Nil

 48

Table 2.5: Feedback of Unskilled Employees on HR Planning in CPP

Questions Very True Partly Not

True True True
Clarity of Objectives 57% 34% 9% Nil
Working for Welfare of Employees 60% 33% 7% Nil
Accessibility of Services 47% 46% 5% Nil
Opportunities provided to Internal 39% 53% 8% Nil
Applicants
Non biased Interview Techniques 41% 49% 10% Nil

Few questions were asked to the skilled and unskilled workers of CPP regarding
the clarity of objectives and accessibility of services of HR department to the
employees and from the feedback given by the employees it was seen that skilled
employees were much clear about the objectives of the organization i.e. 80% than
the unskilled ones i.e. 57% . Employees when asked about the working of HR
department for the welfare of the employees, it was observed that 74% of the
skilled employees gave their answer as true while only 60% of the unskilled
workers were satisfied with the welfare facilities so received. As the feedback of
services being provided by the HR department to the employees 57% of the
skilled employees were very true that the services are accessible to them while
only 5% were partly true. On the other hand only 47% of the unskilled workers
were very true about the accessibility of the services of HR department to them
while 5% were partly true.

Employees when asked, if the internal applicants were getting the equal
opportunity by the HR department for recruitment and selection, 45% or the
skilled workers gave answer as very true while 2% gave the answer as not true.
On the other hand only 39% of the unskilled workers gave the answer as very
true and 53% as true. Employees were asked, if the test and interview techniques
were non biased, 56% of the skilled workers were sure that it was non biased
while only 41% of the unskilled workers were sure about it.

2.10 Conclusion: Hence it can be said that Human Resource Planning is a

forward looking function as it consists in estimating future manpower
requirements and developing human resource plans for their implementation in
any enterprise. Human Resource Planning is neither static nor rigid as it can be
amended, reviewed and adjusted accordingly with the needs of the organization.
As in the process of Human resource planning the demand and supply forecast of
the human resources are carried down through various methods and techniques so
 49

the same is done in CPP for manpower planning through the combination of
different methods and techniques.

And on comparing all the tables above it can be concluded that the HR
Department popularly known as the Personnel & Administration Department,
works in CPP which is further divided into different sections such as Security,
Human Resource, Administration, Personnel, Safety, Liason & Legal etc. the
executives are clear about their objectives and tasks and have good inter linkage
with the other departments while the workers, specially the unskilled one are not
very clear about the tasks and objectives of the CPP, for which they are working.
Even they feel that the HR department is not providing them the welfare services
more effectively and if they providing any such services, it is not easily
accessible to them in comparison to the skilled ones. Even the workers feel that
the recruitment and selection opportunities being provided to the internal
applicants is not so good in comparison to the opportunities being provided to the
external applicants. As well as the test and interview techniques are also biased in
case of unskilled workers than the skilled ones.
 50

REFERENCES:

1. Sharma A. M. (2009). Personnel and Human Resource Management.

Himalaya Publishing House. P-75.

2. Dale S. Beach. (1977). Personnel-Management of People at Work. P-411.

3. Bruce P. Coleman. (1970). Vol-13. An Integrated System of Manpower

Planning. Business Horizon. P-89.

4. William J. Rothwell. (1988). Strategic Human Resource Planning and

Management. Prentice-Hall. New Jersey. P-173.

5. William J. Rothwell. op.cit., P-175.

6. http://hrmba.blogspot.in/2009/10/human-resource-forecasting.html

7. http://highered.mcgraw-hill.com/sites/dl/free/0070951772/846002/
Bulmash_SampleChapter2.pdf.

8. Dr. Gupta. C.B. (1996). Human Resource Management. Sultan Chand &
Sons. New Delhi. P-2.21.

9. Jean J. Jones and Thomas A. Decothis. (October 1969). Job Analysis:

National Survey Findings. Personnel Journal. P-805.

10. Dr. Gupta. C.B. (1996). Human Resource Management. Sultan Chand &
Sons. New Delhi. P-2.34.

11. Rao. VSP. (2000). Human Resource Management(Text and Cases). Excel
Books. New Delhi. P-125.

12. Aswathappa, K. (3rd Edition). Human Resource and Personnel

Management text and cases. Tata Mc Graw Hill Publishing Co. ltd. New
Delhi. P-76.

*******
 51

Chapter 3

RECRUITMENT, SELECTION AND TRAINING

3.1 RECRUITMENT

Recruitment is the process of finding and attracting capable applicants for

employment. The process begins when new recruits are sought and ends when
their applications are submitted. The result is a pool of applicants from which
new employees are selected.1

Thus we can say that recruitment is the process of searching for prospective
employees and stimulating them to apply for the jobs in the organization.2

3.1.1 Factors Affecting Recruitment:

There are number of factors that affect recruitment process which can be
categorized under two category as-

1. Internal Factors-: Those factors which affect recruitment process within

the organization are known as internal factors. They can be:

i. Size of the organization- If the organization wants to expand its business

or increase its operations, more personnel will have to be hired to handle
its operations.

ii. Recruitment Policy- Recruitments in an organization can be done in two

ways i.e. from internal sources or external sources, which can affect the
recruitment process.

iii. Organizational Image- Every qualified and competent person, want to be

in an organization he likes to work for and good image of an organization
attracts these qualified persons.

iv. Image of job- As good image of organization attracts the qualified and
best personnel in an organization so does the image of a job.

v. Interference of trade union- If the trade unions of an organization

interfere in recruitment and selection process it is possible that they may
 52

force the management to employee people not on the basis of

qualification but on some extraneous grounds like relatives, friends etc.

2. External Factors-: There are some of the external factors also which
influence the recruitment process such as:

i. Demographic Factors- Demographic factors like sex, literacy, age,

economic status etc. are intimately related to human beings and have
profound influence on recruitment policy.

ii. Legal Considerations- The recruitment policy of an organization depends

on legal considerations regarding employment by the government. One of
an example of such consideration is reservation of jobs belonging to
various categories like scheduled Castes (SC), scheduled tribes (ST) and
other backward classes (OBCs).

iii. Supply and demand of labour- If the company has a demand for more
professionals and there is limited supply in the market of the demanded
professionals, then recruiting employees will involve more efforts. On the
other hand if supply is more than the demand recruitment will be much
easier.

iv. Unemployment situation- When the unemployment rate in a given region

is high there is oversupply of qualified labour. In this case recruitment
procedure becomes much easier.

v. Competitors- The recruitment policies of the competitors also force the

organization to change its recruitment policy. As to face competition the
organization has to change its recruitment policy according to the policies
followed by its competitors.

3.1.2 Recruitment Process:

Recruitment is a process of searching, identifying and attracting the right person

for the right job. For this different steps are to be followed known as recruitment
process. So, the aim of HR department should be on keeping recruitment process
design as simple as possible.
 53

Figure 3.1: Recruitment Process

(Source : Herbert G. Herman III et.al. (1986). Personnel/Human Resource

Management. Homewood. P-226.)

1. Recruitment Planning- The first step in recruitment process is planning.

Here planning is done to design a comprehensive job specification for the
post to be filled. It defines the major and minor responsibilities of the job,
experience, skill and qualification, pay structure, nature of the job whether its
temporary or permanent etc. The information so gathered is used during other
steps of recruitment to speed up its process.

2. Strategy Development- After the planning process is completed and it is

known that how many and what type of personnel are required for the
organization, the next step is to frame a suitable strategy for recruiting
candidates. The strategy is basically focused on the issues like from where the
applicants must be selected, type of recruitment method to be used,
geographical area to be taken for recruiting the personnel, activities to be
followed in the recruiting the candidates by an organization etc.

3. Searching- The sources from where the candidates are recruited is searched
in the next step of recruitment process. Basically there are two sources used
to attract candidates; Internal Sources & External Sources.

4. Screening- Once the applications of the applicants are received by the

organization, HR department goes through these applications, using job
description as their guide, select the best match applicants. The main goal of
screening is to ensure that the highest quality applicants are sorted for the
 54

most appropriate job. Techniques of screening vary depending on the source

of supply and methods of recruitment.

5. Evaluation and Control- Evaluation of the recruitment process helps in

exercising control over certain aspects of the recruitment process such as cost
of recruitment, quality and number of the new personnel selected, people
involved in the recruitment process etc.

3.1.3 Sources of Recruitment:

In today’s competitive world each organization needs to hire and retain good
talents in its organization. For this it is constantly busy with recruiting people
from best universities, other consultant companies or from some other sources.
Basically each organization has option of choosing its desired candidates for its
recruitment process from two sources which are as:-

1. Internal Sources: Internal source of recruitment refers to obtaining persons

who are already on the payroll of the organization. Whenever a vacancy
arises it is advertised within the organization and on the basis of responses
made the selection process is done. There are different methods of internal
recruitment sources such as-

i. Promotion: Promotion refers to transfer of an employee to a higher position

carrying higher responsibilities, status, salary, and position.

ii. Transfers: Transfer means shifting of employee from one job to the other or
from one place to the other without any drastic change in the responsibilities,
status, salary, and position.

iii. Retrenched or Retired Employees: Sometimes employees retrenched due to

lack of work are recalled due to obligation, pressure of trade unions etc.

iv. Dependents and Relatives of Deceased and Disabled Employees:

Sometimes with the view of commitment and loyalty organization may hire
dependents of the deceased or disabled employees.

v. Employee Referrals: The existing employees can develop good prospectus

by acquainting their friends and relatives into their company as they are well
aware about the qualification, experience, skill and caliber of them. So, they
can refer them to the company for the vacancies to be filled in the
organization.
 55

vi. Previous Applicants: Sometimes the organization may re-contact those who
have previously applied for the jobs through mails or messages to fill up the
vacancies i.e. specially for unskilled or semiskilled jobs.

2. External Sources: External sources of recruitment refer to prospective

candidates that lie outside the enterprise. The various sources of external
recruitments are as-

i. Advertisements: The most common method used for recruitment from

external sources is advertisement which can be done through newspapers,
websites or periodicals. This method can be used for jobs like clerical,
managerial or technical. To recruit the right candidates through
advertisement the company needs to draft the advertisement properly and
clearly specifying the favorable picture of company and its working culture.
Advertisement copy should be prepared by using a four-point guide called
AIDA. The letters in the acronym denote that advertisement should attract
Attention, gain Interest, arouse a Desire and result in Action.3

ii. Employment Exchanges: The compulsory Notification of Vacancies Act of

1959, also known as Employment Exchange Act was instituted by the
government that makes it obligatory for each public sector and private sector
enterprises to notify the nearest employment exchanges of vacancies (if there
are any in their organization) in order to provide information about vacancies
to the candidates and help the companies in finding suitable candidates for
their organization.

iii. Employment Agencies: Along with government agencies there are various
private employment agencies also who are engaged in providing a nation-
wide or area-wise service in matching demand and supply of personnel.
ABC Consultants, A. F. Ferguson and company, ABS Consultants etc are
some of the popular private employment agencies working in India.

iv. Campus Recruitment: In this method recruiters contact various educational

institutes and interview the final year students who are soon to get graduated.
After interview the suitable candidates are selected based on their academic
records, intelligence, personality etc.

v. E-recruitment: After the technological revolution it has become easy for

both organization and job seekers to fulfill their requirements. Organization
advertises its job vacancies through internet and job seekers send their
applications through mail for the specific vacancies.
 56

vi. Gate Hiring: This kind of recruitment is applicable generally in those

organizations where factory workers are to be appointed. Whenever the
vacancies arise in the organization or permanent workers are absent the
people available at the gate are recruited or substituted in necessary number.

vii. Competitors: The method is popularly known as poaching or raiding where

rival firms identify the right people and try to attract them to join in their
companies. They offer them better terms and conditions to lure them.

viii. Labour Contractors: This method is used to recruit manual workers through
contractors who are themselves employed in the organization. These
contractors are the specialists who provide manpower supply to the
manufacturing units. These contractors are appointed for a specific time
period and when these contractors leave the organization the people who are
appointed by them have to also leave the organization.

Table 3.1: Recruitment Practices followed in India

SI. Method of Types of Job Percentage of

NO Recruitment firms
White Blue Both Total Method Method
used Not
used
1. Public employment - - 36 36 100% NIL
agencies
2. Private employment 6 - - 6 17% 83%
agencies
3. Direct hiring at gate - 22 - 22 61% 39%
4. Nomination by 1 4 17 22 61% 39%
present
5. College/Universities 7 - - 7 20% 80%
6. Advertisement - - 32 32 89% 11%
7. Productivity/Training 4 - - 4 11% 89%
centers
8. Personal 1 - 29 30 83% 17%
Applications
(unsolicited)

(Source: P. Sethirmadhavan and Kuldeep Singh: Sprucing up the Organization,

Indian Management, December 1997.)
 57

Table 3.1 shows the recruitment process followed in India. Recruitment through
Public employment agencies and advertisement recruit both types of employees,
white collared as well as blue collared while the other agencies either hire more
of white or blue collared jobs. Direct hiring at gate includes all the blue collared
jobs.

100% methods of recruitment are being used by Public employment agencies,

89% by advertisements and the least one is used by productivity/training centers
i.e. 11%.

3.2 SELECTION

Selection is the process of choosing from among the candidates from within the
organization or from the outside, the most suitable person for the current position
or for the future position.4

3.2.1 SELECTION PROCESS

Selection process of an organization has several steps-

1. Preliminary Interview: In the first stage of selection process undesirable

and unqualified applications are eliminated based on the information
supplied in the application forms. It is a sorting process to reject misfits as
per the minimum qualification, experience or knowledge. Due care should be
taken to ensure that the sorting process may not lead to the elimination of
desirable candidates.

2. Application Blanks: After clearing the preliminary interview, applicants are

required to fill application blank which helps in collecting the relevant
information from candidates regarding their age, qualification, background,
experience, reference, reasons for leaving their previous job etc. The
candidates have to fill the form and send it back to the organization before
the specified date along with the copy of certificates, photographs etc.

3. Selection Tests: After receiving the filled application blanks from the
applicants, they are called for various tests in order to select right person for
the right job. These tests are conducted by psychologists and educationists to
assess the candidates’ suitability and stability in the organization.
 58

4. Reference Checks: Applicants are asked to mention the names and

addresses of two or three persons whom they know. After the interview is
over these persons are contacted through formal letters, telephone or
personally just to ask their opinion about the candidate. The main purpose of
reference check is to know the past of the candidate and verify the
information provided in the application form.

5. Medical Examination: After the reference check, the candidate has to

undergo a medical examination to ensure his physical and mental fitness as it
increases his productivity and decreases the chances of absenteeism. A job
offer is provided to the candidate only after passing the medical examination.

6. Final Approval: After clearing all the tests and interviews the shortlisted
candidates are issued appointment letters mentioning the post, grade,
allowances, other terms and conditions etc. and asked to join the
organization on a specified date. On the date of joining the candidates are
properly placed and induced in the organization.

3.2.2 PLACEMENT & INDUCTION

After selection procedure the next step in HRM practices is to place and induce
the selected candidates to their new work place and working environment. Once
an individual gets selected by the managers of the company he is placed to its
right position along with his authority and responsibility. In the beginning
candidates are placed for a probation period and their work is observed. If the
work is found satisfactory their jobs are regularized. In short we can say that
induction can be termed as a welcoming ceremony of a new employee in the
organization.

3.3 TRAINING

Training is the systematic modification of behaviour through learning which

occurs as a result of education, instruction, development and planned experience.5

In short we can conclude that, training is the act of increasing the knowledge and
skills of an employee for doing a particular job.6
 59

3.3.1 Need and Importance of Training

It is estimated that in India the percentage of vocationally trained workforce is

very low, hence, the leading firms have to invest on re-training of their
workforce. To increase the efficiency of the workforce it has become necessary to
train them with multi skills. Training can be imparted in the area of knowledge of
the job context, content & its quality, to improve technical and social skills etc.
Importance of training can be highlighted through the following Chinese
proverbs:7

“Give a man a fish, and you have given him meal. Teach man to fish, and you
have given him livelihood.”

“If you wish to plan for a year sow seeds, if you wish to plan for ten years plant
trees, if you plan for life-time develop men.”

So, importance of training for an organization and its employees can be explained
as:

1. Higher productivity- Trained employees can perform better work by using

better methods which improves both quality and quantity of their
performance, which in turn increases the productivity and organizational
profit.

2. Optimum utilization of human resources- Training helps in optimizing the

use of human resources within an organization.

3. Improved quality of work- In a formal training the best method is taught in

a standardized way to the employees which improves their quality of work
and lessens any operational mistakes.

4. Less supervision- A trained worker is well acquainted with his job and ways
to perform it, therefore needs less guidance and control. This reduces
supervisory work and gives extra time to the supervisor to look for some
other important works.

5. Less learning period- As workers are already trained in a systematic

method they need not to waste their time in learning through trial and error
method. This reduces both time and efforts of the employees.

6. Fewer accidents- A trained employee is well aware about his work and
safety measures to be taken by him in doing that work which reduces the
 60

frequency of accidents in the work place. It makes the employees more

proficient in their work.

7. High morale- Training helps in changing the attitude of employees

positively towards their work with improved skill and ability. It improves
their jab satisfaction and morale due to higher earning and job security.

8. Organizational culture & climate- Training helps in creating the learning

culture in an organization and creates a favourable organizational climate by
improving discipline & industrial relations. It reduces absenteeism and
resistance to change. Thus improves stability of an organization.

In short we can say that “no organisation can choose whether or not to train
employees……the only choice left to management is whether training shall be
haphazard, casual and possibly misdirected or whether it shall be made a
carefully planned part of an integrated programme of personnel administration.” 8

Table 3.2: Steps in Training Program

STEP I Establishing a Need Analysis Organizational Analysis

Task Analysis
Person Analysis
STEP II Setting Training Objectives Trainee
Trainer
Training Material
Training Period
STEP III Designing Training Methods

STEP IV Implementation and Administration of Training Programme

STEP V Evaluation

• Establishing a Need Analysis: Need analysis can be seen as a starting point

of training process which helps an organization to decide what specific KSA
(knowledge, skill and attitudes) are needed to improve an employee’s
performance at par to company’s fixed standards. It bridges the gap between
what an employee has and what his job demands from him. In this step, the
training team and the managers analyze and assess the objectives for the
training. Training needs analysis is related to both organizational as well as
individual level.
 61

Table 3.3: Source of Need Analysis Data

Types of Analysis in Training Sources of Data

Needs Assessment
Organizational Analysis
Economic and policy issues
An examination of the environment,
Strategic initiatives of the
strategies, organizational goals, organization
resources of the organization,
Technological change
performance data, personnel
Technological, financial, and human
inventories etc. To determine where resources available to meet training
the emphasis should be placed in the objectives.
organization
Data about turnover, accidents,
absenteeism etc.
Job Analysis
Job descriptions
Job description and job specification
Job specifications
to determine the content of the
Competency assessment
training programme to ensure that the
trainee performs well on the job
Person Analysis
Attitude surveys
To determine which employees need
Group discussions
training And which do not
Questionnaires

Performance appraisals

Skill tests

Exit interviews

Employee performance documents

(Source: Adapted from, Bohlander, Snell, and Sherman 2002 (Agarwala Tanuja.
(2008). Strategic Human Resource Management. Oxford University Press. New
Delhi. P-376.)

• Setting Training Objectives: Once the training needs are assessed,

objectives of training are set. Training goals must be set up in accordance
with the training needs of organization. Training goals provide a direction to
the training programme. Under this step basically four factors are considered
and these are the trainee, the trainer, training material and the training period.
The trainee selection for training is a basic step in setting training objectives
as only those employees must be selected for training who actually need
training and will be benefitted by it. Next step is to select the trainer for
giving training to the employees. Training material on the training to be
provided must be set up well in advance and must be distributed to the
trainees prior to the training session. Length of the training period is
 62

determined according to the trainees’ learning capacity, their skill to grasp,

training content, training methods to be used etc.

• Designing Training Methods: Training methods are employed to achieve

the desired training objectives and a wide range of training methods are
present for this purpose but an organization can’t use all the methods at a
same time. It has to make choice of the techniques to be used for fulfilling its
training as well as organizational needs. The various training methods can be
broadly divided in two categories:

Figure 3.2: Types of Training Methods

On the Job Training Of the Job Training Method

Method

1. Coaching 1. Classroom Method or Lectures

2. Job Instruction Training 2. Role Playing
3. Job Rotation 3. Case Method
4. Apprenticeship 4. Business Games
5. Commitment Assignment 5. In-basket Exercise
6. Vestibule Training 6. Simulation
7. Programmed Instructions
8. Sensitivity Training
• Evaluation: The last step in training process is the evaluation of results.
Since huge sum of money and time is spent on training process it becomes
necessary to determine whether the programme was successful or not.
Evaluation process helps the organization to know the effects of training. The
main objective of evaluation is to determine whether the individual as well as
organizational objectives are achieved or not. And if not, were the
performance deficiencies corrected or not.

3.4 RECRUITMENT AND SELECTION PROCESS IN

CENTURY PULP & PAPER MILL
On the basis of the above discussed components of Recruitment, Selection &
Training process the researcher has focused the concerned study in context with
CPP, Mill. Century Pulp & Paper Mill (CPP) has a well defined and documented
 63

recruitment policy and procedure. The person in charge of the personnel

department is responsible for the conformity of the procedures.

Figure 3.3: Recruitment & Selection Flow Chart in CPP

(Source: Century Pulp & Paper Mill, Lalkuan.)

1. Requisition:

i. Raising the requisition for required vacancy by the concerned

Department Head.

ii. Justification for the need of recruitment.

iii. Recommendation by Department Head.

iv. Endorsement of the recommendation by Head of Personnel.

v. Forwarding to Personnel Department for action.

 64

2. Sourcing:

Figure 3.4: Sourcing in CPP

Sourcing

Internal External

1. Inter-Department Transfer 1. News Papers

2. Employee Reference 2. Placement Agency

3. Notification 3. Business Associate

4. Data Bank 4. Friends & Relatives

5. Ex-employees

3. Receipt of Bio-data:

i. Directly from the candidate.

ii. Through internal reference.

iii. Through post.

iv. Through courier.

v. Through e-mail.

vi. Through employment exchange.

4. Scrutiny and Screening of bio-data:

i. By Personnel Department for matching the notified norms.

ii. By the concerned user department for matching their job requirement
vis-à-vis the required qualification and experience.
 65

5. Short listing for Interview:

i. Forwarding the screened bio-data for short listing by the user

department.

ii. Based on the qualification and experience vis-à-vis the job

requirement, the bio-data are shortlisted.

6. Preparation of Interview Schedule by Personnel Department:

i. Interview schedule for the shortlisted candidates are prepared in

consultation with Departmental head of the user department.

ii. The interview schedule comprises the names of the candidates, date of
interview, time of interview and place of interview.

7. Intimation of the candidates:

i. Intimation is sent in writing with details of date, time and place of

interview.

ii. In the first instance only the candidates from the local stations are
called. Thereafter the outstation candidates, if needed, are called.

iii. Reimbursement facilities for travelling expenses, as well as the mode

and class of travel are indicated in the call letter for outstation
candidates.

iv. Transit house facilities for outstation candidates are arranged for
freshening up, even for tea & breakfast, overnight stay etc.

8. Interview:

i. Types of interview-

a. Panel interview or Departmental interview.

b. One to one interview at Deptt. Head/Personnel, HR/Head/President/Sr.

President
 66

9. Salary Negotiation:

i. Only the selected and approved candidates (by the Deptt. Head) are
called in the Personnel Department for salary negotiation.

ii. Basic criteria for Salary Fixation:

a. Qualification.

b. Year of Passing.

c. Previous experience.

d. Last drawn salary.

Comparison with existing employees in terms of qualification, year of passing,

grade and salary is made.

10. Finalization of Offer:

After the discussion on salary negotiation, proposed compensation package

is discussed with the candidate and offer is prepared and shown to the
candidates. At last, the final offer is converted into appointment.

11. Medical Check-up:

i. Before issuing appointment letter, medical check-up is essential to

ensure the physical fitness for getting employed.

ii. In case of outstation candidates, the fitness certificate is collected at

the time of joining, if it was not done during the time of interview.

iii. Validity of an appointment is subject to physical fitness (medically)

12. Appointment:
i. Preparation-
a. Based on the negotiated offer, appointment letter is prepared giving all
the details of salaries and prerequisites, terms and conditions of
service, rules and regulations of company.
b. Depending on the level, appointment letter is prepared either on
probation basis or on permanent basis.
 67

c. The appointment letter is then signed by the Head of Personnel &

Administration/President/Unit Head.
ii. Issue of Appointment Letter-
a. Appointment letter is issued in duplicate.
b. On the duplicate copy of appointment letter candidate’s
acknowledgement is obtained as a token of acceptance of the
employment terms.
c. Simultaneously, indication of the probable date of joining is also
obtained.

13. Joining Formalities:

Figure 3.5: Joining Formalities in CPP

Reporting at the Personnel Department

Producing Appointment Letter

Submission of Credentials

Receiving of Guidance

Filling up of the Forms

Orientation

Induction

14.

i. Employees joining from outstation:

Employees who are recruited from outstation are reimbursed

travelling expenses for joining the organization and also get
reimbursement for shifting their household goods up to one
truckload subject to the submission of the following documents-
 68

a. Lorry receipts and invoice/bills etc.

b. Stamped payment receipts.

ii. Reporting at the Personnel Department/Time Office.

iii. Submission of the following documents:

a. Copy of the appointment letter.

b. Copy of the release letter.

c. Copy of joining letter.

d. Coloured photos- 1 stamp size and 2 passport size.

e. Copies of educational certificates.

f. Last drawn pay slip.

g. Copy of birth certificates.

iv. Completion of following documentations:

a. Family declaration form.

b. Income tax declaration form.

c. Gratuity nomination.

d. Provident fund nomination form.

e. Employee’s Provident fund and family Pension form.

f. Superannuation, if applicable.

g. ESIC form, if applicable.

h. Medi-claim insurance form, if applicable.

v. Verification of following Documents:

a. Release letter.

b. Last drawn salary slip.

c. Educational certificate.
 69

d. School leaving certificate/Birth certificate.

e. Name and address of the referees.

vi. Bank Account:

Employees are required to open account with the following bank and
notify the account number of Personnel Department/time Office for
crediting the salary-

a. SBI Bank

b. Axis Bank

Company issues consolidated salary to employees’ bank account.

15. Explaining Basic Rules and Regulations for the Following:

i. Attendance System.

ii. Duty Hours.

iii. Payments of Salaries and Perquisites.

iv. Holidays and weekly off.

v. Leave and Leave Rules for availing leaves.

vi. Sports.

vii. Dispensary.

viii. Sanskrit Mandal.

ix. Consumer Stores.

x. Transport Facility.

xi. Canteen Facility.

16. Orientation: I Phase: In Personnel Department.

On the very first day the new employee is oriented in Personnel department
regarding following things:

i. Duty Timings.

ii. Punctuality.
 70

iii. Attendance.

iv. Leave Rules.

v. Medical Facilities.

vi. Canteen Facilities.

vii. Salary- mode and day of salary disbursement.

viii. Perquisites.

ix. Benefit and Schemes.

x. Statutory procedures such as ESI, PF, signing of necessary forms to

nominate beneficiaries etc.

II phase: At Department Level

On the second day the employee is oriented in his own department where he/she
is placed on following things:

i. The Departmental people.

ii. Immediate Superiors.

iii. Work place and sitting place.

iv. Physical facilities like chairs, tables, tools etc.

v. Nature of assignment and responsibility.

vi. Working hours, shifts etc.

vii. Area of work.

III Phase: Proposed.

A formal induction programme for six day is conducted at the end of every
quarter (the last six days of the month). All those employees who join in that
quarter are taken through this programme.

The details of the programme are chalked out by the Personnel Department in
consultation with the HRD department ten days in advance. All functional heads
of the major functions are invited at this pogramme for presentation of their
departmental activities. At the end of this induction pogramme a feedback-cum
suggestion form is distributed to the participants to invite their views and
feedback.
 71

3.4.1 Some important terms and conditions in CPP:-

Categories of Appointment in CPP: Appointments of employees in CPP are

subject to suitable report and recommendation of the interview taken and also the
approval of the concerned Division head. Appointment can be categorized as
under in CPP-

1. Permanent Workers.

2. Probationary- Employees in all cadres are recruited on probation basis.

3. Trainees- Trainees are recruited as G.E.T/D.E.T subject to vacancies.

Probation Period: 6 months extendable further depending on performance and

recommendations of the concerned Department Head.

Confirmation: Conformations are done on the following basis-

1. Summary of performance reports for six months are compiled and

forwarded to Departmental/Divisional Head for necessary
recommendation.

2. Personnel Head takes the necessary action as per the recommendation.

Components of Notice Pay: Notice pay comprises of regular monthly basic

salary.

Transfer: All appointments are transferable but only at the instance of

management which can be from one department to other or from one location to
other.

Separation: Separation can be of two types-

1. By Action:

a. By Resignation.

b. By Termination.

c. By Voluntary Retirement.
 72

2. Automatic Separation:

a. Death.

b. Retirement.

Grounds for Termination:

1. For poor performance.
2. For misconduct namely chronic disobedience, absenteeism, negligence,
corruption, indiscipline etc.
3. For violation of company’s rules and regulations.
4. For Non-availability of job/position.
5. For medically unfit except on the account of employment injury.

3.4.2 Methods of Recruitment in CPP: In case of Recruitment of Workmen.

1. Vacancies up to grade 2 to be filled from casuals are among workmen’s

children and dependent of the deceased workmen.
2. For regularization of casuals, following factors are considered:
a. Seniority.

b. Qualification.

c. General Behaviour.

d. Suitability for the job.

Table 3.4: Qualification & Experience required for each grade of workmen

Category & Grade Qualification Experience

W-1 High School 2 Years

W-2 Inter/ I.T.I. 2 Years

High School 4 Years

W-3 Inter (SC) 2 Years

Inter/ I.T.I. 4 Years

High School 6 Years

 73

W-4 I.T.I. 6 Years

High School 8 Years

W-5 I.T.I. 8 Years

High School 10 Years

(Source: Century Pulp & Paper Mill, Lalkuan.)

Methods of Recruitment in CPP: In case of Recruitment of Staff.

Trainees (Freshers) are recruited through interviews at work or campus

interviews.

Experienced candidates are searched as:

1. Resumes received from data bank from Personnel Department are shot
listed by the concerned HODs & then, these short listed candidates are
called for interview.
2. On the basis of the reference received from employees, candidates may be
called for interview at works. Approved vacancies are filled up in
accordance with the recruitment policy in CPP.

Qualification and Experience for each position in CPP as in Annexure 3.

 74

Figure 3.6: Flow Diagram of Training & Development Activities in CPP

(Source: Century Pulp & Paper Mill, Lalkuan.)

 75

3.4.3 Training & Development in Century Pulp & Paper Mill

In Century Pulp & Paper Mill (CPP) training development activities play a
significant role. The management tries its level best in developing their people
through this tool in the most effective & efficient manner. All the training and
activities are quite exhaustive in nature and hence include carefully woven
exercises. Utmost care is taken to make the training process effective.

Steps taken in respect to training and development in CPP are as:

I Step: Identification of training needs.

The HRD Department each year at the beginning of calendar year (i.e. April to
March) sends a format having list of employees and topics/subjects to all the
HODs for identification of training needs of each employees working in their
department or section. The topics may be related to fire & safety, technical points
or some other general topics etc.

Similarly the HOD’s in consultation with shop floor in-charge and supervisors
identify the need for actual training of their employees in their respective
departments for the next year also. Once the training needs are identified, the
department sends it back to the HRD department who prepares final identification
lists. These lists are then signed by the respective department’s or section’s head.
One copy of the list remains with the concerned department and the other one is
recorded at the HRD department.

Sample of the final identification list in CPP given in Annexure 4.

II Step: Receiving and Analysing the list.

Once the training need identification lists are received from different
departments, HRD department analyses the training needs and hence finds out the
number of employees those who need training on a particular subject or topic.
Thus, number of employees needing training on particular subject or topics is
identified, so that it may become easier to prepare training programmes for
upcoming year or month.

Sample of analyses of training need in CPP given in Annexure 5.

III Step: Preparation of Annual Calendar.

After identifying the number of employees needing a specific type of training for
each subject HRD department makes a planned schedule to conduct a training
programme in the upcoming year. This schedule is known as Annual Training
Calendar which depicts the topic, duration of the training, trainer, participants
 76

and the month of training. The annual calendar once prepared is circulated to all
the concerned HOD’s.

Specimen of Annual Calendar in CPP as in Annexure 6.

IV Step: Preparation of monthly calendar.

After the preparation of annual calendar it is further broken into monthly training
calendar. This calendar depicts the day and date of training programme, topic,
time, name of the trainer and category of the participants. The monthly training
calendar is then circulated to HOD’s on the first or second day of the month in
order to make the trainer and department aware of the time and day of the
programme.

Table 3.5: Specimen of Monthly Calendar in CPP

Date Trainer Topic Time Participa

nt
03-02-06 Mr. B. Paper making in 10AM to Joint
Karmakar Baiiase.se (OJT) 12 Noon

04-02-06 Mr. M. M. Bleach Plant operation 3 PM to Workers

Agrawal (OJT) 5 PM

04-02-06 Mr. Naresh Hydraulic System & 3 PM to Joint

Kumar Circuits 5 PM

06-02-06 Mr. P. K. V-Belts (OJT) 10AM to Workers

Agrawal 12 Noon
Mr. S. Bothra
(Source: Century Pulp & Paper Mill, Lalkuan.)

V Step: Inter-office memo or circular.

Though the departments are informed about the training schedules through
monthly calendars on the first day of each month but conformation or organizing
schedule programme on the fixed day, time and the place is informed to all the
departments and sections through a circular or inter-office memo 24 hrs before
the training programme. These memos and circulars are the final verdict of the
 77

training programme, in absence of these it must be understood that no programme

will be held on the scheduled day or time.

VI Step: Actual Training.

The HRD Department of CPP maintains a well equipped and big training hall
where all types of external as well as internal trainings or seminars take place.

All the essential instruments like mike, electronic media, laptop, OHP, LCD TV,
Ac etc. are available in the HRD hall. All the participants are well informed in
advance about the training programme to be present at the proper time and proper
place.

Before starting up the training programme following activities take place:

1. Providing Attendance list to the participants.

The attendance list is given to the trainees attending the training which
has various categories and the trainees are required to fill it in the
following manner:-

i. Firstly the attendance slip has to be filled and signed by the trainees
present in the ongoing training programme. They are asked to fill
their token number, name, designation, and name of the concerned
department along with their signatures.

The main aim of attendance list is to register the presence of the trainee for a
specific session to avoid any future repetition. As once attended a particular
training session an individual should not go for the same unless directed by his
HOD.

The format of attendance list of participants as in Annexure 7.

2. Conducting the training Programme.

Once the attendance slips are filled up the trainer starts his training
programme with giving introduction of the subject. He provides required
training on the topic and shares his knowledge with his trainees.
Generally, the training programme remains interactive all the time and
lasts with question answer session.
 78

3. Receiving Feedback from Trainees.

Feedback forms are distributed to the participants by the trainer, which

are designed by the HRD department. The participants have to fill up the
forms and mark the points through which they can express how they
utilized the knowledge gained from the training programme.

4. Feedback from Trainer.

The HRD department also gets the trainer’s feedback on a prescribed

form. Feedback is taken regarding the requirement of any infrastructure,
participants intellectual or any other facilities needed in such future
sessions. Suggestions are also received for making the programme more
beneficial and effective.

VII Step: Evaluation of the Effectiveness of Training.

For all the training procedures in CPP the company has fixed five levels of skills.
For any employee to become the master of their jobs the concern department
identifies his employees for training till they get skill level ‘4’. Each of a new
entrant is expected to enter the organization with level ‘0’. He learns practically
about his job and acts to achieve his target. Then gradually his skill rises from 0
to 1,2,3,4.

The evaluation of effectiveness of training in CPP as in Annexure 8.

These skill levels on the feedback forms help the HRD to evaluate the trainees’
present skills. HRD collects back the feedback forms once filled from the concern
departments. These filled forms help the HRD department to analyze the data and
keep the records of effectiveness of different training programmes.

On the Job Training in CPP:

Training on the technical skills is given on the job site. Trainer is given all the
related papers of training by the HRD department and the same are received back
after the end of the month for records.

Off the Job Training in CPP:

HRD department in CPP makes arrangements for its workers and the staff to
attend the seminar or training programme organized by external agencies in
different location or cities.
 79

Those employees who attend these training programmes after returning back
have to submit an outside training report form along with the booklet or any other
literature which they receive in seminars, to the company. Also they share their
knowledge with seniors and colleagues and tips which they noted down in the
seminars.

Types of In House Training in CPP:

In CPP, training and development programme are divided into four heads-

1. Technical- This type of training is aimed at enhancing the technical

knowledge and skill of the participants. In each training programme
participants are taught a specific skill as operational or maintenance skill
of machinery in order to acquire the required skill and awareness about a
new machine to perform the job in much better way.

2. Behavioral- This type of training provides all types of self development

programmes in which employees are made to realize their own potential
and encouraged to continuously improve them. The main focus is on
achieving a better understanding of self and others so that they behave in
a more coordinated manner and understand & accept their co-workers
amicably. This head normally includes stress management, how to control
anger, continuous improvement, communication skills etc.

3. Fire & Safety- This programme aims at knowing the importance of safety
in one’s life. Employees are encouraged to work safely. The programmes
included in this training helps the employees to take out preventions while
handling chemicals, while doing work at height or in a confined place.

4. Others- Number of miscellaneous training programmes are covered under

this head:

i. Quality Management System ISO 9001:2008.

ii. Environment Management System ISO 14001:2004.

iii. 5’S, Kaizen and Housekeeping.

iv. First Aid.

Human Resource Department Faculty Feedback Form and Outside Training Form
in CPP as in Annexure 9.
 80

Table 3.6: Feedback of Executives on Recruitment, Selection & Training in

CPP
Questions Very True Partly Not True
True True
Use of Technological Support Nil 50% 30% 20%

Well Structured Questionnaire Nil 40% 20% 40%

Training provided to Interviewer 20% 20% 30% 30%

Non Biased tests & Interviews 10% 60% 10% 20%

Judgemental Interview Questions 10% 70% 20% Nil

Well Planned Induction program Nil 70% 30% Nil

Effective Orientation Program 10% 70% 20% Nil

Regular Assessment of Training Needs 20% 60% 20% Nil

Training Techniques up to mark 10% 50% 40% Nil

Feedback Procedures Adopted Nil 50% 50% Nil

From the above Table it can be found that only 50% of the executives think that
CPP is using technological support for recruitment while 20% think it don’t.
Similar answer is given on the question that whether the company is using well
structured questionnaire or not, 40% executives gave answer as true while 40%
were not true. Executives when asked about the training being provided to the
interviewer before interview or not 20% gave answer as very true while 30%were
not true. Only 10% of the executives think that the interview and tests being
conducted in CPP are non-biased as well as questions being asked are able to
judge the interviewee. While 60%-70% think it as true.
On the question based on induction and orientation techniques in CPP 70% of the
executives feel that the mill is following well planned and effective induction
program as true. 70% executives feel it true for the regular assessment of training
needs and 50% feel that training provided in CPP is up to mark while 50% feel it
true and 50% partly true that the HR Department is using feedback procedure
after every training session.
 81

Table 3.7: Feedback of Skilled Employees on Recruitment, Selection &

Training in CPP

Questions Very True Partly Not

True True True
Proper time Provided for Induction 42% 50% 8% Nil
Job explained during Induction 34% 46% 19% 1%
Advance Information of Training 75% 23% 1% 1%
Comfortable Training Place 76% 21% 3% Nil
Effective Teaching Mode 48% 47% 5% Nil
Enhancement of skills through Training 67% 25% 8% Nil

Table 3.8: Feedback of Unskilled Employees on Recruitment, Selection &

Training in CPP
Questions Very True Partly Not
True True True
Proper time Provided for Induction 43% 49% 8% Nil
Job explained during Induction 29% 54% 17% Nil
Advance Information of Training 44% 49% 7% Nil
Comfortable Training Place 71% 27% 2% Nil
Effective Teaching Mode 72% 27% 1% Nil
Enhancement of skills through Training 69% 29% 2% Nil

From the tables above it can be seen that 42% skilled workers and 43% unskilled
workers are very true that proper time is being provided to the new employee
during the induction period while 59% of skilled and 49% of unskilled workers
are true. When employees were asked that whether their job was properly
explained to them during this period 34% of skilled and 29% of unskilled
workers gave answer as very true while 46% and 54% respectively gave the
answer as true.
Employees when asked about the prior training information being provided to
them or not 75% skilled workers gave answer as very true while only 44% of
unskilled workers were very true. The feedback of workers on the comfort level
of training places was almost same 76% skilled workers and 71% of the unskilled
workers gave answer as very true. On the other hand the feedback of both skilled
and unskilled workers on the use of effective teaching mode during training was
different, skilled workers were not very happy with the effectiveness of teaching
mode as only 48% gave answer as very true while 72% of unskilled workers gave
 82

answer as very true. Employees when asked whether the training being given to
them in CPP was enhancing the skills of workers 67% of skilled workers and
69% of unskilled workers were very true.

3.5 CONCLUSION:
So, it can be concluded at last that all the three processes Recruitment, Selection
and Training form an integral part of HR Management and through these
processes only one of the most important resource of an organization i.e. human
resource can be appointed. Through Recruitment the best qualified human
resources for a vacant post can be attracted towards the organization preceding
with the Selection process, where the best capable person is selected among the
other and at last the selected ones are trained accordingly, as training is necessary
to increase the knowledge and skill of new as well as present employees to enrich
their work.

Through the feedbacks of employees and executives on these three processes of

management it was seen that executive’s feedback on the related questions were
almost true. While on the other hand it was almost same for the skilled and
unskilled workers, only the unskilled workers were not so satisfied with the job
explanation to them during the time of induction and the information provided to
them in advance for the upcoming training session.
 83

REFERENCES:

1. William B. Werther and Keith Davis. (Fourth Edition).(1993). Human

Resources and Personnel Management. Mc Graw Hill. New York. P-195.

2. Flippo Edwin. B. (1989). Personnel Management. Mc Graw Hill. New

York. P-141.

3. Khanka, S.S. (2009). Human Resource Management (Text and Cases).

S.Chand & Company Ltd. P-58.

4. Koontz and O’Donnel. (1972). Principles of Management. McGraw Hill

Book Company. New York. P-418.

5. Michael Armstrong. (1992). A Handbook of Human Resource

Management. Aditya Books Private Limited. New Delhi. P-198.

6. Edwin B. Flippo. (Sixth Edition). (1984). Personnel Management.

McGraw-Hill Book Company. New York. P-200.

7. Khanka, S.S. (2009). Op.cit,. P-110.

8. Gupta C. B. (1996). Human Resource Management. Sultan Chand &

Sons. P-3.7.

9. Goldstein L. L. (Second Edition). (1986). Training in organizations:

Needs, assessment, development and evaluation. Monterey CA. Brooks-
Cole.

******
 84

Chapter 4

MOTIVATION

The term ‘Motivation’ is derived from the word ‘motive’, which means an inner
state of our mind that initiates or sustains activity. It is an important function to
be performed by the managers of an organization for enthusing people for work
to accomplish the predetermined organizational goals and objectives.

“You can lead a horse to water but you can’t make it drink.” Meaning of this
famous proverb is that, you can show a path to an individual but can’t make him
walk without his own will. Similarly, in an organization the core of every activity
is human activity. It depends on human will to act or not. Will to work is more
important than the capacity or power to work. One can purchase man’s time and
his physical work but not his enthusiasm or loyalty. So, motivation helps to
bridge this gap by energizing, directing and sustaining human behavior towards
the organizational goal. Effective motivation helps in directing an employee’s
desire to do the best possible job and exert his maximum efforts to perform the
tasks assigned to him.

Motivation, refers to the way in which urges, drives, desires, aspirations, strivings
or needs direct, control or explain the behaviour of human beings.1

Figure 4.1: Motivation Process:

Unsatisfied needs are the starting point in the motivation process. These
unsatisfied needs results in tension within an employee and motivates him to
search different ways to satisfy his tension. Once he finds the way, there’s a
reduction in his tension and gives birth to new unsatisfied needs. Hence, here
completes one cycle of motivation process. The motivation process is an on-
going process and keeps on working within an individual.
 85

4.1 IMPORTANCE OF MOTIVATION

Motivation is the core of management2, so is very important for every
organization because of its following benefits:

1. Increase in Productivity:- When workers are motivated continuously from

within or outside, they become more passionate in doing their job and
perform much better. This passion of doing work improves the productivity
and quality of the work hence, secures best possible utilization of resources.

2. Improved Morale of Employees:- If, motivation provided on a continuous

basis to an employee he tends to work hard and accomplish the challenges,
which in turn improves his morale level amongst himself.

3. Helps in achieving the organizational goals:- To achieve an organizational

goal, environment of co-operation and co-ordination is required within an
organization, which can be effectively done through motivation. Motivated
employees are more loyal to the organization and have cordial relations with
their superiors and subordinate.

4. Helpful to Managers:- It is seen that a motivated employee is generally more

quality oriented. So, a clear cut knowledge and understanding of how the
motivation works helps a manager to make his employees quality oriented
and hence increase organizational effectiveness.

5. More Creative Work force:- Motivated employees perform the task assigned
to them more freely and passionately. This helps them to improve their work
and show better levels of creativity and imagination in their work.

6. Stability of workforce:- The more the employees are motivated, the more
they become loyal to their work and the organization. The feeling of
participation in the organization makes them more loyal to the organization.
The loyal workers tend to be more satisfied and comfortable with their job.

Hence, the importance of motivation to an organization can be summed up as, “If

we compare management with driving, while the organisation is the vehicle, then
motivation is the power or fuel that makes the vehicle moving.”3
 86

4.2 THEORIES OF MOTIVATION

With the establishment of human organizations, various thinkers got engaged in
finding out the solutions to what can motivate people at work. These different
approaches applied by them gave birth to different motivational theories. These
theories are as:-

1. Maslow’s Need Hierarchy Theory: One of the first behavioural scientists to

make management aware of the complexity of human needs and their effect
on motivation was Abraham Maslow.4 This theory received more attention
from the managers than any other theory. It is the simplest and most widely
discussed theory of motivation. Maslow’s theory is based on the human
needs, which increase progressively. As soon as one need satisfies new need
crops up in its place. Only unsatisfied needs can influence individual
behaviour, satisfied needs act no more as motivators. Maslow’s need
hierarchy identifies five levels in his theory as-

Figure 4.2: Maslow’s Need Hierarchy Theory

Maslow’s Need Hierarchy

The five levels of need hierarchy theory of Maslow are as:

 87

i. Physiological Needs- The most basic, powerful and essentials of all

human needs are psychological needs which are necessary for one’s
survival. They include food, clothing, shelter, air, water, rest, sex,
protection from extreme temperature etc.

Maslow adds: For our chronically and extremely hungry man, Utopia
may be defined simply as a place where there is plenty of food. He tends
to think that, if only he is guaranteed food for the rest of his life, he will
be perfectly happy and will never want anything more. Life itself tends to
be defined in terms of eating. Anything else will be defined as
unimportant. Freedom, love, community feeling, respect, philosophy, may
all be waved aside as fripperies that are useless, since they fail to fill the
stomach. Such a man may fairly be said to live by bread alone.5

ii. Safety and Security Needs- After satisfying the psychological needs,
safety and security needs become motivators. These needs include the
needs for protection from physical harms, economic disasters, ill-health
and confidence that psychological needs will be fulfilled in the future
also (like pension plan, insurance policy, provident funds etc.) Meeting
these needs required more money, which motivates an individual to work
hard.

iii. Belonging and Love Needs- Man is a social animal, so needs social
interactions, love, affection and belongingness etc. A person feels lonely
and rejected in the absence of friends, relatives or children. In an
organization social needs represent the need of a co-operative work
group, friendly supervision and peer acceptance. So, managers make their
level best efforts to encourage informal groups within an organization to
motivate their employees. This helps in reduced absenteeism among
employees as workers develop affiliation with their co-workers.

iv. Self-Esteem Needs- Satisfaction of esteem needs is very difficult as it

involves understanding your own talents and limitations, to know the
value of your own experiences and to be able to relate with others.
Fulfillment of esteem needs leads to feeling and attitude of self
confidence, strength, worth and capability of being useful in the
organization. In contrast, inability to fulfill these needs leads to
inferiority, weakness, ineptness and helplessness.
 88

v. Self Actualization Needs- After fulfilling the lower four level needs, the
need for self actualization comes next. The term self actualization was
coined by Kurt Goldstein and means to become actualized in what one is
potentially good at.6 Self actualization is a desire to be everything that an
individual is capable of becoming which can help him in the peak of his
potential. Knowing self actualization needs of employees, employers may
direct them towards achieving their personal as well as organizational
needs.

2. McClelland’s Theory: McClelland, with his associates developed a well

known need based theory of motivation that opposes Maslow’s Need
Hierarchy Theory. This theory relates a little with learning theory, as
McClelland feels that needs are learned and acquired by the people from their
environment and people, who acquire a particular need behave differently
than those who don’t have them. David McClelland’s model of motivation is
based on three types of needs, which are as7

i. Need for achievement (n-Ach): a drive to excel, advance and grow;

ii. Need for power (n-Pow): a drive to influence others and situations;
and

iii. Need for affiliation (n-Aff): a drive for friendly and close
interpersonal relationships.

3. Herzberg’s Two Factor Theory: Frederick Herzberg, a well known

behavioural scientist proposed a popular two factor theory of motivation. He
published his theory first time in a book entitled ‘The Motivation to Work’ in
the year 1959. Herzberg’s original research took place in the offices of
engineers and accountants in spite of the factory workers. There, he
interviewed around 200 employees, employed by firms. The employers were
asked two questions8

(i) when did you feel particularly good about your job, and (ii) when did you
feel exceptionally bad about your job?

Critical incident methods were used to obtain the responses. After analyzing
the responses it was concluded that the responses received when the
employees feel good about their job were significantly different from the
responses received when they felt bad. Good feelings among the respondents
 89

were due to job satisfaction while bad feelings were due to job dissatisfaction.
Herzberg labelled the job satisfiers motivators, and he called job dissatisfiers
hygiene or maintenance factors.9 Thus the theory was named as, Herzberg’s
two Factor Theory of Motivation.

According to Herzberg, the opposite of “Satisfaction” is “No Satisfaction”

and the opposite of “Dissatisfaction” is “No Dissatisfaction”.10

Figure 4.3: HERZBERG’S VIEW OF JOB SATISFACTION AND

JOB DISSATISFACTION

SATISFACTION MOTIVATORS NO SATISIFACTION

NO SATISIFACTION HYGEIN FACTORS DISSATISFACTION

Herzberg’s theory of motivation is much common to Maslow’s theory of

motivation, as both the theories focus on motivational factors. Psychological,
safety and social needs of Maslow’s hierarchy relates to Herzberg’s hygiene
factors while Maslow’s higher level needs relates to Herzberg’s motivators. In
spite of these similarities both the theories differ in their approaches. Maslow’s
hierarchy of need states that once a lower level need satisfies it becomes a
motivator and gives rise to next higher level need. But Herzberg’s hygiene factor
only prevents job dissatisfaction rather than being a motivator to the employees.
 90

figure 4.4: Comparison of Maslow’s and Herzberg’s Theory of Motivation

4. Vroom’s Valence-Expectancy Theory: Vroom’s Valence-Expectancy

Theory was proposed by Victor Vroom from Yale School of Management in
the year 1964. This theory expands on the work of Herzberg and Maslow.
The expectancy theory has its roots in the cognitive concepts of pioneer
psychologists Kurt Lewin and Edward Tolman, and in the choice behaviour
and utility concepts from the classical economic theories11. The basis of
valence-expectancy theory is that the people are motivated to put high level
of efforts at their work when they believe that it will lead them to desired
outcomes. It studies the relationship between effort, performance and
rewards. Vroom’s valence expectancy theory can be expressed in the form of
equation as:

Motivation (M) = Expectancy (E) X Instrumentality (I) X Valence (V).

 91

Figure 4.5: Expectancy Theory from a Manager’s Perspective

Individual decides to work hard and
give best efforts.

Expectancy ------------------------------ “I expect to be a high performer”

High performance is achieved and is

associated with:

Instrumentality -------------------------------

Being ostracized for being a high Merit pay increase

performer
Recognition for good work
Being Transferred
Being considered for promotion
Being expected to always be a high
Being named to work
performer
improvement committee

Negative valence outcomes Positive valence outcomes

(Source: Singh Nirmal. (2005). Motivation- Theories and Practical Applications.

Deep & Deep Publications Pvt. Ltd. New Delhi. P-160.)

5. McGregor’s Participation Theory: In the 1950s, Douglas McGregor (1906-

1964), a psychologist who taught at MIT and served as president of Antioch
College from 1948-1954, criticized both the classical and human relations
schools as inadequate for the realities of the workplace. He believed that the
assumptions underlying both schools represented a negative view of human
nature and that another approach to management based on an entirely
different set of assumptions was needed. McGregor laid out his ideas in his
classic 1957 article "The Human Side of Enterprise" and the 1960 book of the
same name, in which he introduced what came to be called the new
humanism.12

Douglas McGregor in his book put forward two aspects of human behaviour
at work place in the form of two theories, i.e. ‘Theory X’ and ‘Theory Y’.

McGregor’s Theory X is a traditional theory which believes in an

authoritarian style of management. It is a negative type of theory as it
 92

assumes that average type of people don’t like doing their work and tend to
avoid it, if possible. So, it’s a duty of management to direct, motivate, control
and modify their actions according to organizational demand. For this
management can offer rewards, to the workers with higher productivity or
punish those with performance below average. This approach is known as
‘carrot and stick’ approach to motivation. According to this theory workers
need to be watched and instructed constantly.

McGregor questioned the Theory X and said “The conventional approach of

Theory ‘X’ is based on mistaken notions of what is cause and what is
effect.”13

McGregor’s Theory ‘Y’ is a positive type of theory as it encourages worker’s

participation in work. The Theory assumes that people put their efforts
towards their work naturally, they don’t have to be compelled or pressurized
by their supervisors for doing the work. Workers become committed towards
their work if their needs are well satisfied. The Theory emphasizes on
fulfilling their workers need rather than being authoritarian. So, it can be said
that adaptation of Theory ‘Y’ can produce self direction towards
organizational goals without any external control applied. Employees can
seek opportunities for self respect and personal improvement.

6. Urwick’s Theory Z: Much after the Propositions of theories X and Y by

McGregor, the three theorists-Urwick, Rangnekar, and Ouchi-propounded the
third theory labeled as Z theory.14 Theory Z is not a part of theory given by
McGregor, rather it may be seen as an extension of the work of McGregor
after analyzing management conditions and its different cultures with regard
to motivation.

William Ouchi, the professor of the University of California developed his

theory Z in 1981, in his book ‘Theory Z: How American Management can
meet the Japanese Challenge’. Around the year 1980’s Japan was well known
for the highest productivity all over the world, while America’s productivity
was falling drastically. In his book Ouchi stated, how American companies
can meet the challenges of Japanese companies in a highly effective and
efficient management style in order to transform their business. After his
study Ouchi concluded that reason for Japanese highest productivity was the
way how they manage their employees, rather than their technology.

7. Porter and Lawler’s Expectancy Theory: Porter and Lawler’s expectancy

theory is an extended theory of Vroom’s Theory. They further developed
Vroom’s model. They viewed motivation, performance and satisfaction as
 93

three separate variables which relate to each other in ways different as

assumed in traditional theories.

Figure 4.6: Porter and Lawler Model of Motivation

Perceived
Value of Abilities Intrinsic Equitable
Reward & Traits Rewards Rewards

Efforts Performance Satisfaction

Accomplishment

Probability of Role Extrinsic

Receiving Perception Rewards
Rewards

There are four variables in Porter and Lawler’s model. Under this model effort or
motivation does not lead directly to performance rather they are mediated by
traits, abilities and role perception followed by rewards. This performance
ultimately leads to satisfaction. The four main elements of Porter and Lawler’s
theory are Effort, Performance, Rewards and Satisfaction.

8. Adam’s Equity Theory: The popular equity theory of motivation was put
forward by the famous psychologist John Stacey Adams in the year 1963. The
theory assumes that employee’s motivation is affected by their desire to be
equally rewarded (output) for the efforts that they put into their work (input).
They want their output to be equal to their input. The core of Adam’s equity
theory is a fair balance between employees input and his output. If the
balance between input and output is not balanced positively the employee
feels de-motivated and expresses his de-motivation through reduced efforts,
being dissatisfied and frustrated. On the other hand in case of positive equity
the employee feels satisfied and tries to give his best to the organization.

Self Output Others Output

Equity = =
Self Input Others Input
 94

Here, in this equation inputs are the quality and quantity of contribution made by
an employee towards his organization in the form of hard work, enthusiasm,
loyalty, responsibility, skill level, commitment, flexibility, adaptability etc.
Whereas, output are the rewards which an employee gets for his contribution in
the form of salary, bonus, perks, benefits, commission, recognition, praise.,
promotion, sense of achievement, job security etc.

Figure 4.7: Adam’s Equity Theory

INPUT Output

Hard Work, Loyalty, Enthusiasm, Pay, Salary, Promotions, Fringe

Responsibility, Skill Level, Benefits, Commission, Perks
Adaptability, Education, Experience, Recognition, Praise, Bonus, Priority,
Commitment, Flexibility etc. Acknowledgment etc.

9. Alderfer’s ERG Theory: The ERG Theory of Clayton P. Alderfer is a

model that appeared in 1969 in a psychological Review article entitled “An
Empirical Test of a New Theory of Human Need.”15 His theory can be seen as
a modification of Maslow’s Need Hierarchy Theory. He extended and
modified his theory from five levels to three levels. ERG stands for
Existence, Relatedness and Growth.

Figure 4.8: Alderfer’s ERG Theory

E EXISTENCE R RELATEDNESS G GROWTH

Existence is at the lowest level and includes physical and safety needs like food,
shelter, water, clothing, physical love, safe working conditions etc. This level
 95

includes Maslow’s lower two level needs. Relatedness includes Maslow’s third
and fourth level needs and include social and self esteem needs like relationship
with friends, families, coworkers, employers etc. Growth includes self
actualization needs, the need for personal growth and development.

4.3 MOTIVATIONAL TOOLS:

Motivation is an important step of Human Resource Management used in a

workplace by mangers to inspire employees to work, both individually as well as
in groups to maximize their productivity. Hence, motivational tools are those
devices which inspire people to work. The human needs vary accordingly. It is
different for every individual and at different point of time even for a same
person, so, it becomes a duty of manager to identify these needs individually and
use such motivational tools which are able to satisfy the human needs.

The various motivational tools which can affect the employees directly as well as
indirectly are as-

1. Incentives: The term incentive refers to a positive motivational influence

which encourages someone to work in a desired direction. It is a promise
which stimulates employees for greater action. Incentives are provided to
employees in addition with their remuneration in order to provide zeal among
employees to give their best to the organization. Incentives can be broadly
classified into two groups-

a) Financial Incentives-: It can be given to the employees in the form of

wages & salaries, medical reimbursement, bonus, housing facilities,
insurance, retirement benefits etc.

b) Non-Financial Incentives-: The non-financial incentives include status,

growth opportunity, praise or recognition, worker’s participation in
management, competition, security of service etc.

2. Job Enrichment: Job enrichment is a direct outgrowth of Herzberg’s16 theory

on motivation. Job enrichment allows employees to use their abilities by
providing them more authority and responsibility. This motivates the
employees to perform their task more efficiently and effectively. Job
 96

enrichment helps in increasing job satisfaction among workers. It discourages

labour turnover and absenteeism.

3. Job Enlargement: Job enlargement relates with horizontal expansion of job

related activities. It refers to increasing the number of tasks of a specific job.

4. Job Rotation: Job rotation may also be seen as a motivational tool in an

organization. Under this technique employees are moved from one job to the
other in a planned manner on regular intervals.

5. Management by Objectives: The term ‘management by objectives’ (MBO)

was first coined by Peter Drucker17 in 1954. Under this system the objectives
of management are aligned with the objectives of employees. This helps the
employees to understand what they should do and how it will affect the
organization. MBO defines the roles and responsibilities of an employee and
guides him to put his best to achieve the predetermined goals of the
organization in a given time period. It provides a proper sense of direction to
the employees and makes easy for them to discriminate between the
necessary tasks to be completed and those tasks which can only waste their
valuable time. Employees’ greater participation in management helps to
improve their morale and hence motivates them to improve their efficiency
and productivity.

6. Goal Setting: Goal setting theory was developed by Edwin A. Locke in the
1960s. His first article on goal setting theory was “Toward a Theory of Task
Motivation and Incentives” which was published in 1968. This article laid the
foundation for goal setting theory and established the positive relationship
between clearly identified goals and performance.18

7. Employee Empowerment: Money is a primary reason which motivates

employees to work, but beyond the certain limit, money fails to be a
motivator. So, employee empowerment can serve as one of the motivator in
such case. Empowerment in general refers to, increasing the spiritual,
political, social, educational, gender, or economic strength of individuals and
communities19. And Employee empowerment refers to the process of
authorizing an employee with the power to make decisions regarding his job.
 97

It enables an employee to think, act, take decisions and control his work in an
autonomous way. It gives an opportunity to the employee to take risk without
making compromises with the organizational goals.

8. Quality Circles: The concept of quality circles was first pioneered in Japan
around 1960s which has now spread all over the world. A quality circle is a
volunteer group of seven to ten workers who meet together, usually under the
leadership of their supervisor ( who is elected as their team leader) to identify,
analyze and solve problems affecting their work. The membership in quality
circles is voluntary and the members are from the same working environment.
As the workers from same working group are well familiar about the
problems faced by them.

9. Empowered Teams: Empowered teams are quite similar to quality circles as

these are also self directing and self managing teams. The main features of
empowered teams are as20:-

i. They plan, set goals, supervise progress and improve the same.

ii. These teams prepare their own budgets and maintain coordination
with other departments of organisation.

iii. They are free to acquire any training which they feel necessary.

iv. They prepare their work schedules and then monitor the same.

v. These teams take sole responsibility for achieving quality in their

products and services, whatsoever be the case.

vi. These teams are also given right to share with management in decision
making process.

10. Worker’s Participation in Management (WPM): Worker’s

participation in management also known as participative management
leads to motivation, increased efforts and higher productivity in an
organization. Worker’s participation in management refers to the
involvement of non-managerial workers in the management based
processes. If the workers are also allowed to participate in the decision
 98

making processes, they accept the decisions made easily as they feel
themselves the part of that decision in spite of feeling burdened with those
decisions. Such participation allows workers to express their views in the
functioning of the enterprise.

11. Employee Health and Safety: The term health relates with the state
which is free of physical or mental illness, disease or any other
malfunction. Ill-health of employees is a curse for both management and
employees. Employees with ill-health can’t be able to work productively
for the organization. Unhealthy employees show higher rate of
absenteeism, poor performance, less productivity and are much prone to
accidents in the working areas. Therefore, the management must be
careful about the health of his employees. Employees must be provided
with proper cleanliness, ventilation, lightning, clean drinking water,
effective disposal of wastes etc. There should be proper arrangements of
first aid, in case of any emergency.

4.4 VARIOUS MOTIVATIONAL TOOLS USED IN CPP:

After the study of different theories of various philosophers and thinkers and the
tools provided on motivation by them the various motivational tools being used
in CPP can be studied now as:

1. Employee Suggestion Scheme: The main aim of suggestion schemes used in

CPP is to utilize the talents of the employees for the development of the
organization as well as the employees. To motivate the employees for their
participation, positive attitude and thinking for the development of the
organization, scheme to award the best suggestion providers is also included
in the suggestion scheme.

Salient features of Suggestion Schemes are as-

• Responsibility of effective implementation and coordination lies with

Personnel / HRD Dept.
• 30 suggestion boxes inside the plant are easily approachable and have
fixed day of opening twice (i.e. Wednesday & Saturday) every week. The
suggestion which may directly / indirectly affect the working/
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environment/ growth of the company and saving of Natural resources are

covered under the scheme.
• List of the suggestions are prepared and committee of four persons select
two best suggestions every week. Finally out of 8 selected suggestions
two best suggestions are awarded first and second prizes. The final
decision of the best two suggestions is taken during the HOD’s meeting,
after detailed discussion.
• Help of the suggestion provider is taken during the implementation of the
suggestion.
2. Attendance Award Scheme: To motivate the employees to give their
services regularly without any absenteeism, best attendance award is given to
the workers on the basis of the attendance during the calendar year. This
award is given to the concern workman publicly on Republic day.

3. Safety Award Scheme: To motivate employees to develop safe working

environment & safety awareness CPP has following Safety award schemes-:

• Best safety award given on the basis of Safety Committee’s Activities /

Contributing for safety awareness
• Best Housekeeping Award
• Best Safety Slogan Award
• Best Safety Poster Award
• Electrical Safety Awareness Award (Electrical Conservation Day).

These awards are given on 4th March i.e. “Safety Day Celebration”.

Appraisal, Praise or Recognition: It is the policy of CPP to promote Staff

strictly on the basis of their Performance, suitability, vacancy, merit, distinct
achievement/ distinguished contribution to the organization. The company praise
and recognize an employee for his specific achievement.

To fulfill the status need, time bound system of up-gradation of graded staff and
workmen is also in existence to motivate the employee.

4. Work Load / Incentive Scheme: To motivate employees to work more

efficiently and enthusiastically, CPP adopted Incentive scheme. Under the
 100

scheme every employee is being paid extra money as work load allowance
along with salary / wages of the month.

Work load is calculated on the basis of production as below:

1) Month of 31 days = Total production of month = Average production
29
2) Month of 30 days = Total production of month = Average production
28
3) Month of 29 days = Total production of month = Average production
27
4) Month of 28 days = Total production of month = Average production
26

Average production per month Rate of work load payment

Above 675 MT 8/= per ton

5. Fringe Benefits and some of the Social Security Schemes also motivate the
employee to faith on the company. It increases the belongingness and the
employees work with loyalty and sincerity. These schemes fulfill the basic
needs of a person, hence plays a specific role in motivating the employees.
Existing schemes in CPP are-:

i. Medi-claim Policy

Insurance Agency; Future Generally Insurance.

Eligibility for coverage: All permanent workmen and graded staffs, their
wives and two children below 21 years of age.

Coverage: Up to 50000 in a year, once for any eligible person.

Conditions for claim: At least 24 hours hospitalization is compulsory.

 101

Card system is available in those hospitals which are connected with

hospital network. Where there are no such hospitals, the employee will
submit his bills to the organization. The organization will forward the
genuine bills to the Insurance Company and the Insurance Company will
pay the amount to the organization. The organization will pay to the
concern employee.

ii. Rehabilitation Fund

Fund Generation: Contribution of Rs. 25 per month per employee and the
same amount will be contributed by the organization.

Joint Committee: A joint committee consists of union representatives and

representatives from management side. Two members from each union
(i.e. 12 members) and five persons from management side.

Coverage/Eligibility: Only permanent workers, dependent wives, two

children including mother and father. Maximum age limit of son finalized
is 25 years for coverage under this fund.

Disease Covered: Only 15 diseases are covered under this scheme like
[Cancer, Angioplasty, Open heart surgery, Kidney problem, AIDS,
Hepatitis (A,B,C,D,E) Brain Operation, Lung operation, Joint
replacement, Brain tumour, Paralysis, Spinal cord operation, Rabbis,
Paresis.]

Maximum Limit for the benefit: One Lac per workman and Fifty
Thousand per dependent.

Condition: For one disease the benefit will be availed once in five years,
one can get relief for different diseases once in a year.

Procedure: First the employee submits his application for help with
supporting papers, the doctor of CPP after verifying the disease puts it
before the joint committee. After properly discussing the case, the amount
is sanctioned to the concern person.
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Mode of Payment: 50% of sanctioned amount given as an advance to start

the treatment and the rest of the amount after the completion of the
treatment.

iii. Group Personal Accident Policy

In case of accidents, whether inside or outside the plant, the affected

person is benefitted by this insurance policy.

Eligibility: Employees those who are out of ESI (Workman & Staff)

Table 4.1: Table showing Status of GPA in CPP

S. Designation Insurance Benefits

No. Workman Coverage
Treatment Medicine
expenses expenses

1 Workman to 1 Lac 1% of the insured 40% of the

Officer sum treatment amount

2 Sr.Officer to 1.5 Lac -do- -do-

Asst.Mgr

3 Dy. Mgr 2 Lac -do- -do-

4 Manager to 3 Lac -do- -do-

Sr. Mgr.

5 DGM & 5 Lacs -do- - do-

above

(Source : Century Pulp & Paper Mill, Lalkuan)

6. Quality Circles: To encourage participation of workmen in increasing

productivity the company facilitates the group of workmen i.e. Quality
circles. To motivate the QC the best performer QC is appraised and honoured
by the management. A certificate of recognition and a gift prize is given to
each group member.
 103

7. Counseling Fee of Rs. 5000 is provided to graded staff & workers’ son for
B.E./B.Tech/I.I.T/Medical course, whosoever will beat the competition.

Table 4.2: Feedback of Executives on Motivation in CPP

Questions Very True True Partly Not True

True
Efforts made 10% 80% Nil 10%
for Retention

Motivation in Unsatisfactory Below Average Outstandin

CPP Nil Average Nil 100% g Nil

Assistance on 10% 30% 40% 20%

personal issues

In the table above few questions were asked to the executives regarding

motivation in CPP and the feedback given by them was as: Executives when

asked whether the organization is making necessary efforts to retain qualified

employees in the organization only 10% were very true while 80% were true.

Then executives were asked to rate motivation provided in CPP, 100% of them

rated it as average. Feedback regarding the company’s policy to assist employees

on personal issues was 40% as partly true while 20% gave answer as not true

also.
 104

Table 4.3: Feedback of Skilled Employees on Motivation in CPP

Questions Very True True Partly True Not True

Satisfactory 35% 33% 31% 1%

Incentives Provided
You Enjoy your 67% 28% 5% Nil
Work
Opportunities given 58% 36% 5% 1%
to Express Views
Weightage given to 54% 38% 6% 2%
Suggestion
Safe Working 26% 63% 11% Nil
Conditions Provided
Motivational Factors Monetary Non Both
39% Monetary 49%
12%
Motivation Rate in Unsatisfactory Below Average Outstanding
CPP 7% Average 68% 2%
23%

Table 4.4: Feedback of Unskilled Employees on Motivation in CPP

Questions Very True True Partly Not True
True
Satisfactory Incentives 31% 58% 11% Nil
Provided
You Enjoy your Work 61% 37% 2% Nil
Opportunities given to 43% 42% 15% Nil
Express Views
Weightage given to 41% 46% 13% Nil
Suggestion
Safe Working 35% 55% 10% Nil
Conditions Provided
Motivational Factors Monetary Non Both
19% Monetary 81%
Nil
Motivation Rate in Unsatisfactory Below Average Outstanding
CPP 5% Average 58% 9%
28%
 105

The table shows the feedback of skilled and unskilled workers on the motivation
given to them in CPP. Workers when asked about the incentives provided to them
in CPP was satisfactory or not, 35% of the skilled workers were very true and
33% partly true on the other hand 31% of the unskilled workers gave answer as
very true, 58% as true and 11% as partly true. Employees when asked whether
they enjoy coming to the mill daily and giving their best, the feedback of skilled
as well as unskilled workers was almost same, 67% of skilled and 61% of
unskilled workers were very true. Employees when asked whether they were
provided with the opportunities to express their ideas to upper management 58%
of skilled workers were very true while only 43% of the unskilled ones were very
true and so was the case regarding the weightage given to their suggestions by the
superiors, 54% of the skilled one gave answer as very true while only 41% of
unskilled workers gave answer as very true. Employees when asked about the
healthy, safe and comfortable working conditions of the plant 26% of skilled
workers were true and 63% were true on the other hand 35% of the unskilled
workers gave answer as very true and 55% as true. Employees were then asked
that which factor motivates them the most, 39% of skilled workers gave answer
as monetary factor while only 19% of unskilled workers said monetary, 12% of
skilled workers are motivated even by non monetary incentives and 49% by both.
On the other hand no unskilled worker wanted non-monetary factor as a
motivator but maximum of them wanted monetary and non monetary incentives.
At last when employees were asked to rate the motivation system in CPP, 68% of
unskilled workers rated it as average, 23% as below average, 7% as
unsatisfactory while only 2% rated it as outstanding. On the other hand 58% of
unskilled workers rated it as average, 28% as below average, 5% as satisfactory
and 9% as outstanding.

4.5 CONCLUSION:

So, it can be said that while comparing the general motivational theories and
tools given by different thinkers and philosophers with that of tools and
techniques used in CPP, the researcher has concluded that few parts of various
theories like Maslow’s Hierarchy, Herzberg’s Two factor theory, Porter’s &
Lawler’s Expectancy theory etc are being used in CPP while many tools like
incentives (both non monetary and monetary), Quality circles, Workers
 106

Participation in Management, Employee Health & Safety etc are being used in
CPP.

And on comparing the feedbacks from the tables above it was seen that both
skilled and unskilled workers are having almost same view regarding the
incentives being provided to them but unskilled workers are given lesser
opportunities to express their views to upper management and if given chance the
proper weightage is not given to their suggestions. And maximum of unskilled
workers want both monetary as well as non monetary incentives as a motivational
tool.
 107

REFERENCES:
1. Dalton E. McFarland. (1974). Management Principles and Practices.
New York. P-537.

2. Likert Rensis. (1961). New Pattern of Management. McGraw Hill. New

York.

3. Khanka, S.S. (2009). Human Resource Management (Text and Cases).

S.Chand & Company Ltd. P-187.

4. Maslow A. H. (1954). Motivation and Personality. Harper and Brothers.

New York.

5. Aswathappa, K. (Fifth Edition). (2008). Human Resource Management

TEXT AND CASES. Tata Mc Graw Hill Publishing Company Limited.
New Delhi. P-366.

6. Khanka, S.S. (2009). op.cit. P-189.

7. http://www.mbaknol.com/management-concepts/theories-of-motivation-
mcclelland%E2%80%99s-three-need-model/

8. Khanka, S.S. (2009). op.cit. P-189.

9. Ibid. P-189.

10. http://www.managementstudyguide.com/herzbergs-theory-
motivation.htm.

11. Aswathappa, K. (Fifth Edition). (2008). op.cit. P-377.

12. http://www.referenceforbusiness.com/management/Str-Ti/Theory-X-and-
Theory-Y.html#b#ixzz2HZaBs5IW

13. Singh A. K., Duggal B. R., Mohan Puneet. (2010). Human Resource
Management and Development. Sun India Publication. P-416.

14. F. L. Urwick: Theory Z, Indian Administrative and Management Review,

Jan-March,1974, Sharu S. Rangnekar: The Last Alphabet of Management
Theory Z, Industrial Times, June 1972, and William Ouchi: Theory Z,
Addison-Wesley, 1981.

15. http://www.valuebasedmanagement.net/methods_alderfer_erg_theory.
html
 108

16. Fredrick Herzberg. (1996). Work and Nature of Man. World Publishing
Company. Cleveland. Ohio.

17. Peter F. Drucker. (1954). The Practice of Management. Haper & Row.
New York.

18. http://en.wikipedia.org/wiki/Goal_setting

19. http://en.wikipedia.org/wiki/Empowerment

20. Richard S. Wellins. (1991). Empowered Teams. San Francisco. Jossey

Bass. P- 4.

*******
 109

Chapter 5

GRIEVANCE AND GRIEVANCE HANDLING

5.1 MEANING OF GRIEVANCE

Grievance refers to any dissatisfaction or sense of injustice which is felt by an
employee in relation to his pay, working conditions, leave, recoveries of dues or
other aspects of employment. Broadly speaking, “a grievance is any
dissatisfaction that adversely affects organisational relations and productivity.”1
Grievance may sometimes be expressed and sometimes not. Even sometimes, it
may not be valid also. The grievance arises when the employee feels that
something’s happening or going to happen unfair and unjust to him in the
organization.

Complaints affecting one or more individual workers in respect of their wage

payments, overtime, leave, transfer, promotions, seniority, work assignment, and
discharge would constitute grievance. Where the points at dispute are of general
applicability or considerable magnitude, they will fall outside the scope of this
procedure.2 However, some type of grievances may be beneficial for the
organizations, as it may direct the attention of management towards improving
the working conditions, incentive plans, leave plans etc. When grievances,
generally, minor one are not expressed by the employees they just accumulate
and lead to major conflicts inside the organization such as lockouts, strikes or any
other collective disputes. Therefore, proper administration of grievance and
grievance handling is necessary in an organization as unattended grievances may
lead to frustration, low productivity, increase rate of absenteeism, feeling of
discontent etc.

5.1.1 Causes of Grievances:

Whatever be the causes of grievances, they fell under the following categories3-

1. Concerning Working Conditions:-

i. Unsafe and unpleasant working conditions.
ii. Inadequate toilet facilities, dirty toilets, etc.
iii. Non-availability of necessary raw material, tools and machines.
iv. Misfit between worker’s ability and job.
 110

2. Concerning Management Policy and Practices:-

i. Wage rate and its payment.
ii. Incentive.
iii. Seniority.
iv. Promotion.
v. Transfer.
vi. Fines, punishments and penalties.
3. Concerning Violation of Rules and Regulations:-
i. Organizational rules and regulations.
ii. Civic laws.
iii. Past practices.
iv. Procedure of collective bargaining.
4. Concerning Personality Traits:-
i. Fault-finding attitude.
ii. Over-ambitious.
iii. Mental-tension.
iv. Negative approach to life.
v. Excessive ego feelings.

5.1.2 Forms of Grievances: There may be three forms of grievances in an

organization such as-

1. Factual: When an employee is dissatisfied with his employment because of

legitimate or genuine reasons such as violation of employment contract by the
employers or unfulfilling of any other factual needs. The grievance is
regarded as factual.

2. Imaginary: When an employee is dissatisfied with his employment because

of a wrong perception, wrong attitude or wrong information, it gives rise to
imaginary grievance. Though for such case the management is not liable but
still the responsibility to resolve the problem rests with it.

3. Disguised: The dissatisfaction among employees in such case may be due to

the reasons that are not known to the employees themselves. This
dissatisfaction may be due to the pressure from other directions like family,
friends, neighbors etc. The manager himself has to detect such grievances and
resolve them through counseling the related employee.

5.1.3 Effects of an Undressed Grievance: If the grievances remain unidentified

and thus undressed may have adverse effects such as:-
 111

1. It reduces the quality and quantity of production.

2. Increases the wastage of material and thus the cost of production.

3. Increases the rate of absenteeism and rate of accidents at the work place.

4. It reduces the morale of employees and thus reduces the level of

commitment and sincerity of work.

5. Indiscipline cases increases which gives rise to increase in supervision.

6. Increase in industrial conflicts.

5.2 GRIEVANCE PROCEDURE:

In an organization, employees facing problems must be listened carefully and
provided with prompt responses. For this an effective grievance procedure must
be followed by the institution. Grievance procedure helps employees to raise their
concerns, if any, about their job with the management. The concerns may be
related to their working conditions, wages, leaves, promotions etc. There is a
specific procedure adopted by every institution. This procedure is made well
known to all the employees and they raise their grievances according to that
procedure only. Employees can use the procedure freely without any fear.

5.2.1 Need for Grievance Handling Procedure:

1. Grievance procedure helps an organization to identify and the grievance,

its nature and its causes.
2. It provides an organization with an established and well known method of
processing grievances.
3. The procedure helps employees to show their feelings to the management.
The problems which can’t be solved by the first line managers can be
easily resolved by it.
4. It helps the management to detect faults in working conditions and take
corrective measures for their settlement.
5. It helps in increasing employees’ morale and his productivity.
6. It helps in keeping a check on the employers if being biased against the
workers, as their actions can be challenged by the employees.
7. It helps the management to know the feelings and opinions of their
employees about the rules and regulation of the organization.
8. It provides uniformity in the grievance handling.
9. It helps in solving conflicts and disputes within an organization and thus
strengthening good industrial relations.
 112

5.2.2 Steps followed in Grievance Handling Procedure: To handle grievance

in a systematic manner certain basic steps are followed as-:

Figure 5.1: Steps in Grievance Handling Procedure

Prompt Actions

Identification of the Problem

Defining Correctly

Collection of Facts

Analysing and solving the cause of Grievance

Implementation and Follow up

1. Prompt Actions: The sooner the problems are solved, lesser the impact
they have. So it’s necessary to settle down the problem as soon as it arose.
The first line manager must be trained to recognize and solve such
problems promptly and properly.

2. Identification of the Problem: The supervisor has to identify the problem

first, as every time the grievance expressed must not be legitimate, it’s
possible that the grievance expressed by the employees may be imaginary,
emotional or vague.

3. Defining Correctly: The problem once identified must be defined

properly and accurately by the management.

4. Collection of Facts: Collection of relevant facts and data from all parties
related to grievance is done under this step. The information thus
collected is classified as facts, opinions and feelings to avoid distortion of
the data.

5. Analysing and solving the cause of Grievance: After collection of facts,

the facts are analysed, to find out the real cause of grievance. Once the
cause is identified, the alternative solutions to the problem are developed
 113

and the best one is selected, to settle the grievance and prevent its
reoccurrence.

6. Implementation and Follow up: The decision so selected is

communicated to the employees and implemented immediately by the
effective and efficient authority. After implementation the follow up must
be done at every stage, to ensure effective and quick implementation.

Figure 5.2: Model Grievance Procedure

Voluntary Stage V: Reference with

Arbitration 7 Days of Committee’s
decision

Committee of Union and

Management Representatives Stage IV: Appeal to
Management for
Revision

Manager

Communication of
Grievance Committee decision within 3 days

Departmental Head of the Stage III:

Representatives Department Recommendations
within 7 days

Departmental Supervisor
Representatives Stage II: Decision
within 3 days
Foreman

Stage I: Answer
to be
given within
Aggrieved
Employee 48 hours
Conveys Verbally
(Source: Singh, A. K., Duggal, B. R., Mohan Puneet. (2010). Human Resource
Management. Sun India Publications. New Delhi. P- 543.)
 114

5.3 INDUSTRIAL RELATIONS (IR):

Industrial relations denote the relationships between management and the
workers concerned with industrial organization. It includes the relationship
between management and union, management and employees, employees and
union etc. The parties involved in industrial relations had to work in cooperation
and with accordance with each other. It covers the aspects related to trade
unionism, collective bargaining, grievance and grievance handling, industrial
disputes etc.

Thus industrial relations may be referred to a dynamic and developing concept

which is not limited to be general web of relationships normally obtaining
between employers and employees- a web much more complex than the simple
concept of labour capital conflict.4

There are mainly two sets of factors determining the state of industrial relations
(whether good or poor) in any country. The first set of factors, described as
‘institutional factors’ includes “pattern and pace of labour legislation, policy of
the State relating to labour and industry, extend and stage of development of
trade unions and employers’ organisations and the type of social institutions.
“The other set of factors determining industrial relations, described as ‘economic
factors’ include “the nature of economic organisation (capitalist, socialist-
individual ownership, company ownership or government ownership), capital
structure including technology, the sources of demand and supply in the labour
market, the nature and composition of labour force etc.5

5.3.1 Significance of Industrial Relations: Effective industrial relations aim at

maintaining harmonious relations between employees and management. It
generates industrial peace within the organization, which is necessary for better
and higher production. A sound industrial relation is necessary for the following
reasons-:

1. Uninterrupted Productivity: Good IR ensures continuity of production by

making optimum utilization of available resources. It provides continuous
employment opportunities for all from workers to managers. It also makes
an uninterrupted flow of income for all.

2. Promotes Industrial Democracy: Sound IR helps in establishing and

maintaining true industrial relations in an organization through mutual
cooperation and mutual negotiation among the management and
employees.

3. Reduction in Industrial Conflicts: Disputes lead to dissatisfaction among

employees which reflects in the form of lockouts, strikes and other
 115

grievances. Good industrial relations help in reducing such unrest among

workers and thus promoting cordial and peaceful relations inside the
organization.

4. High Morale: IR helps in boosting up the morale of employees.

Employees feel themselves as the owner of their company and coordinate
their interest with companies’ interest.

5. It Facilitates Change: Sound IR helps in creating a climate of

cooperation, team work, and confidence among workers which helps them
to make fullest use of modern innovations, inventions and other
technological advancements. It helps the employees to adapt themselves
to the changes more rapidly and easily.

6. Discourage Unfair Practices: Due to cordial relations between

management and workers, unfair practices on part of both of them are
discouraged. IR acts as a machinery to solve problems, if arise, within an
organization through mutual understanding and negotiations.

5.3.2 Essentials of Good Industrial Relations: The main aim of industrial

relations is to maintain cordial relations between employees and the management
and to maintain good industrial relations certain conditions must be fulfilled,
which are as:-

1. Strong and Organized Employees’ Union- There should be a well

organized and strong employees’ union present in an enterprise. A weak
union can easily be ignored by the employers.

2. Mutual Trust- There should be an atmosphere of mutual cooperation

within the organization, so that both the management and trade unions
may willingly deal with their problems freely, confidently and with
mutual respect.

3. Sound Personnel Policies- Personnel policies serve as a guide for

personnel matters and for their effective implementation, they should be
formulated in consultation with the employees and their representatives.
Personnel policies must be uniform throughout the organization and must
clear to everyone.

4. Role of Government- Government should play an active role in

formulation and implementation of policies related to economic and social
measures affecting IR. If the management or trade unions are unable to
solve their disputes, government should interfere to settle those disputes
and to restore industrial harmony in the organization.
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5. Training of Supervisors- Supervisors must be given proper training to

ensure that the organizational policies are implemented properly within
the organization.

6. Sincere Execution of Agreements- The mutual agreements between

management and the worker’s must be executed sincerely. As if, the
agreements are not executed then both the parties involved, stop trusting
each other in future.

5.3.3 Cause for Poor Industrial Relations: The various causes for poor
industrial relations in organizations are as:-

1. Poor Compensation and Working Conditions- Employees work for

earning compensation in the form of salary, wages, commission, or other
benefits and if not provided with proper compensation may cause
unhealthy relationships between workers and management. Even poor
working conditions with inadequate infrastructure also serve as a source
of industrial conflicts.

2. Nature of work- A worker loves to work if it’s interesting and completes

it with full devotion. This results in job satisfaction and creates a healthy
relationship between labour and management. On the other hand an
uninteresting nature of work gives birth to dissatisfaction and frustration
and causes poor industrial relations within an organization.

3. Organizational causes- Non- recognition of trade unions, improper

communication system, unfair practices, faulty grievance handling
procedures etc are some of the causes that result in poor IR.

4. Psychological Reasons- Psychological reasons such as lack of job

security, non fulfillment of needs related to survival and maintenance of
human life may worsen the industrial relations.

5. Ineffective Trade Unions- The main aim of trade unions is to safeguard

the employees’ interest but in case of multiple unions, politicisation and
inter union rivalry makes these trade unions ineffective to perform their
work. Unions are used by some of the leaders to serve their own purpose,
which decreases the faith of employees on them and their functioning.
Thus gives birth to unrest among workers and management.
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5.4 INDUSTRIAL DISPUTES:

Good industrial relation is a key to success. The ultimate goal of an organization

can be achieved successfully in a peaceful and cooperative atmosphere. But the
relationship between labour and management are based on contrasting demands
and divergent views. Management wants to achieve maximum productivity with
minimum resources, while employees want to earn more and have fair share in
net profit. These opposite views give rise to industrial disputes and conflicts.

Poor industrial relations often end up with industrial disputes in the form of
strikes, lockouts, gheraos etc. According to Section 2 (k)of the Industrial
Disputes Act, 1947, the term ‘industrial dispute’ means “any dispute or difference
between employers and employers or between employers and workmen, or
between workmen and workmen, which is connected with the employment or
non-employment or the terms of employment and conditions of employment of
any person.” Industrial disputes always harm both employees and management
and are always against their interest. Poor IR de-motivates employees and thus
results in decreased production.

Hence, it may be concluded that, industrial disputes are symptoms of industrial

unrest in the same way that boils are symptoms of a disordered body.6

5.4.1 Types of Industrial Disputes: The various forms of industrial disputes are
as-:

1. Strikes: It means a cessation of work by a body of persons employed in an

industry acting in combination; or a concerted refusal of any number of
persons who are or have been so employed to continue to work or to accept
employment; or a refusal under a common understanding of any number of
such persons to continue to work or to accept employment.7

2. Lock-out: Lock-out means the closing of a place of employment or the

suspension of work, or the refusal by an employer to continue to employ any
number of persons employed by him.8

3. Gherao: Gherao is a form of industrial action in India in which workers

imprison their employers on the premises until their demands are met.9

4. Picketing: Under picketing workers are prevented from entering their work
places. Some workers who are on strike stand at the entrance of their work
places along with the banners or play cards in connection with disputes, to
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drew attention of the general public and prevent their workers to work and
persuade them to join the strike.

5. Boycott: The main aim of boycott is to disrupt the normal functioning of an

organization. Workers are forcefully appealed by the strikers to withdraw
their cooperation with the employer and are prevented from entering the work
place. The workers may also boycott their company products and may appeal
the same to the general public. This forces management to accept the
demands of striking workers as if affects the marketability of their products.

The various causes of industrial disputes can be divided into two categories i.e.
economic and non economic cause. Economic cause includes causes related to
increase in wages, allowances, bonus, gratuity, higher share in industrial profits
etc. On the other hand non economic causes include demand for proper working
conditions, adequate working hours, advanced infrastructure etc. Industrial
disputes have adverse effects on the organization as it creates unrest and
unnecessary tension within an organization due to which employees may lose
their faith on management and vice versa. Sometimes industrial disputes result in
strikes, band, lockouts which decreases the rate of production and hence creates
economic loss.

These industrial disputes can be prevented through various measures like

including worker’s participation in management by giving them right to have a
say in the decision process of the organization. Some of such schemes are Works
Committee, Joint Management Councils, Joint Councils. A code of discipline can
also be led down to assert cordial relation within the organization. Several
tripartite bodies have been set up at central, state and national levels. These
committees are composed of labour experts along with the representatives of
employers and employee. The main objective of these committees is to establish
peace by settling down the differences and misunderstandings between
management and unions which crop up from time to time.The Indian Labour
Conference(ILC) and the Standing Labour Committees (SLC) are the two
important tripartite committees functioning in India. Grievances if arise within
the organization shall be redressed as soon as possible. Collective bargaining can
also act as a powerful measure to avoid industrial disputes.

5.4.2 Industrial Disputes- Settlement Measures: There are chances when

employers and employees fail to sort out their differences themselves. Under
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such situation, the Industrial Disputes Act, 1947 provides a legalistic machinery
to settle such dispute. The machinery comprises of three acts:-

1. Conciliation: Conciliation or mediation refers to the process under which the

representatives of employers and the employees are brought together before
the third party, which persuade them for voluntary settlement of the dispute.
The main objective of conciliation is to settle conflicts promptly and
effectively.

2. Arbitration: On the failure of conciliation process, the disputants agree to

refer their dispute to a neutral third party known as arbitrator, who is
appointed by the parties themselves. Arbitration process is different from
conciliation process as the judgement given on industrial dispute by
conciliator only helps the disputing parties to reach at a decision while the
arbitrator gives his judgement on a dispute to the parties. The arbitrator listens
to both the disputing parties and then gives his judgement on it which is
acceptable to all parties. However, he does not enjoy any judicial powers. He
submits his judgement to the government within 30 days. Thereafter, the
government publishes his judgement within 30 days of its submission and
becomes enforceable after 30 days of the publication.

3. Adjudication: If despite efforts of the conciliation officer, no settlement is

arrived at between employer and the workman, the Industrial Dispute
provides for a three tier system of adjudication viz. Labour Courts, Industrial
Tribunals and National Tribunals under section 7, 7A and under section 7B
respectively. Labour Courts have been empowered to decide disputes relating
to matters specified in the Second Schedule. These matters are concerned
with the rights of workers, such as propriety of legality of an order passed by
an employer under the standing orders, application and interpretation of
standing orders, discharge or dismissal of workman including reinstatement
of grant of relief to workman wrongfully discharged or dismissed, withdrawal
of any customary concession or privilege and illegality or otherwise of a
strike or lockout. The Industrial Tribunal are empowered to adjudicate on
matters specified in both the Second and Third Schedule i.e. both rights and
interest disputes. The jurisdiction of the Industrial Tribunal is wider than the
Labour Courts. In case of disputes which in the opinion of the Central Govt.
involve question of national importance or is of such nature that workers in
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more than one state are likely to be affected. The Act provides for
constitution of National Tribunals.10

5.5 TRADE UNIONS:

A labour union or trade union is an organisation of workers formed to promote,

protect, and improve, through collective action, the social, economic, and
political interests of its members.11 Thus trade union may be regarded as a group
of workers in a particular industry aiming to negotiate with their employers over
issues related to over pay, working hours, job security, health facilities and other
fringe benefits. They are the voluntary associations formed to protect the interest
of their members and promote their welfare.

A trade union refers to, any combination, whether temporary or permanent,

formed primarily for the purpose of regulating the relations between workmen
and employers, or between workmen and workmen, or between employers and
employers, or for imposing restrictive conditions on the conduct of any trade or
business, and includes any federation of two or more trade unions.12

5.5.1 Objectives of Trade Unions: The main objectives of forming trade unions
by the employees are to ensure that fair wages and other benefits are being
provided to each employee in accordance to the other employees in the same
community. Trade unions pressurize the management to provide basic facilities to
the employees such as lightning, sanitation, ventilation, drinking water, safety
equipments etc. They help employees to fight against the improper
implementation of the personnel policies regarding promotions, transfers,
recruitment, training, etc. Another objective of trade unions is to sort out the
industrial dispute between employees and employer. Due to the involvement of
trade unions, supervision procedure has become more democratic. Now the
employees can file a grievance against their employer in case of any
mistreatment. The grievance redressal procedures are also made in a prompt way
through a proper channel now.
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5.6 GRIEVANCE & GRIEVANCE HANDLING PROCEDURES

IN CPP MILL, LALKUAN
Keeping in view the above discussed components of Grievance and Grievance
handling procedures the same is being discussed here by the researcher in context
with CPP mill, Lalkuan. Grievances, if faced in CPP are handled through a
proper channel which is shown through a flow chart as:

Figure 5.3: Grievance Handling Procedure in CPP

Problem

Supervisor

Superior

HOD

Personnel Department

Counselling

Written Statement

Domestic Enquiry

Legal Action

Counsellation Officer

Labour Court
 122

The flow chart above shows that, if an employee in CPP Lalkuan faces any type
of grievance he will get it solved through a proper channel. He’ll first go to his
supervisor with his grievance and if possible the supervisor will try to solve his
problem but in the other case, if problem is not solved, the supervisor will send
the problem to his superior and through superior it will be transferred to the
HOD. If again, the problem remains unsolved, HOD will transfer the grievance to
the Personnel Department.

Once, the grievance reaches to the personnel department, both the

representatives of the trade union and employers are called together to settle
down the grievance. But if the grievance is not settled again, it is taken to the
Deputy Labour Commissioner by the trade union. The commissioner takes
written statement of both the parties and goes for domestic enquiry for taking
certain legal actions. At last the Counsellation Officer takes the grievance to
Labour Court for settlement, and the grievance changes into a dispute between
employees and company.

There are various Trade Unions in CPP Mill, Lalkuan, working for the favour of
employees which help in maintaining good and harmonious relations between
employees and employers. The different Trade Unions in CPP, Lalkuan are as:

1. Century Pulp & Paper Workers Union.

2. Century Pulp & Paper Karmchari Union.

3. Century Pulp & Paper Employees Union.

4. Century Shramik Kalyan Sangh.

5. Century Pulp & Paper Sramik Sangh.

6. Century Pulp & Paper mazdoor union.

7. Century Pulp & Paper Kamgar Union.

8. Century Pulp &Paper Staff Association.

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5.6.1 Collective Bargaining in CPP Mill, Lalkuan

Collective Bargaining helps both the employees and employers to reach an

agreement to regulate the terms and conditions of employment. Both the
representatives of employers and employees (leaders of Trade Unions) they make
joint decisions regarding these terms and conditions. Similarly a Tri-annual
agreement between Trade Unions and Management on demand charter of trade
unions (for the welfare and up-liftment of the mazdoors/employees of the
organization) is being made. Last agreement was effective upto 31st Jan.2012.

In the month of January12 trade unions in CPP submitted the demand charter to
the management. After long discussions / negotiations both the parties reached to
a mutual consent on the issues raised by Unions and a settlement for registration
was submitted at DLC office under Industrial Dispute Act which is enforced from
1. Feb.2012 to 31. Jan 2015.

5.6.2 Disputes in CPP Mill, Lalkuan

The last major dispute in CPP arose due to the reduction in bonus percentage
which resulted due the economic crisis faced by the company at that time. The
labour union started to go slow and refused to work overtime, hence the
production got hampered and thus the losses increased. The management took
hard decision to lock out the mill against the illegal strike and go slow tactics of
the workers. The mill remained under lockout for 65 days. During this period
meetings, discussions & negotiations at different levels took place and finally it
was agreed to start the mill under the jurisdiction of the court in this matter. The
workmen were given 8.33% bonus and one month salary/wages as an advance to
meet out their burning problems. Since, 1998 till now no such Industrial dispute
has arose in CPP.
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Table 5.1: Feedback of Executives on Grievance & Grievance

Handling in CPP

Questions Very True True Partly Not True

True
Effective 10% 50% 20% 20%
Communication
Procedure

Higher Grievance Nil 20% 80% Nil

Frequency

Formal Channel for Nil 50% 30% 20%

Grievance
Redressal

Causes of Work Work Salary Supervision

Grievance Group Environment 10% 20%
40% 30%

Proper record 20% 30% 20% 30%

maintenance of
Grievance

Executives when questioned on the topics related to Grievance and Grievance

Handling procedures in CPP, the feedback were as: When they were asked
whether the communication process is effective in CPP or not 10% were very
true while 50% were true and 20% answered as not true. When they were asked
how often they face grievance in CPP, 80% gave answer as partly true. And when
the reason for grievances was asked 40% said the cause was related to work
group, 30% related to work environment, 10% salary and 20% supervision. Then
executives were questioned that whether any formal channel is being set up in the
organization or not along with the proper maintenance of the record of these
grievances, 50% executives said that it was true that formal grievance redressal
channel is present while 20% were very true and 30% true for the proper
maintenance of the grievance records.
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Table 5.2: Feedback of Skilled Employees on Grievance & Grievance

Handling in CPP

Questions Very True Partly Not True

True True
Satisfaction with 14% 51% 33% 2%
Recent Appraisals
Awareness of 44% 37% 10% 9%
Grievance Redressal
Committee
Causes of Grievance Work Work Salary Supervision
Group Environmen 56% 14%
13% t 17%
Satisfaction with 28% 48% 20% 4%
Grievance Redressal
System

Table 5.3: Feedback of Unskilled Employees on Grievance & Grievance

Handling in CPP

Questions Very True Partly Not True

True True
Satisfaction with 6% 74% 20% Nil
Recent Appraisals
Awareness of 25% 48% 26% 1%
Grievance Redressal
Committee
Causes of Grievance Work Work Salary Supervision
Group Environment 58% 24%
11% 7%
Satisfaction with 12% 53% 35% Nil
Grievance Redressal
System

The questions when asked on Grievance and Grievance Redressal to the skilled
and unskilled workers the feedback were as: Workers when asked about their
satisfaction with the recent appraisal, 14% of skilled workers gave answer as very
true, 51% true, 33% partly true while 2% gave answer as not true. On the other
hand only 6% of the unskilled workers gave answer as very true, 74% as true and
20% as partly true. Workers when enquired whether they were aware of the
 126

grievance redressal committee in CPP 44% of skilled workers gave answer as

very true while only 25% of the unskilled workers gave answer as very true.
Workers then were asked about the causes of their grievances 13% of the skilled
workers gave the cause as work group, 17% as work environment, 56% as salary
and 14% as supervision. While the causes for unskilled workers were as 11%
work related to work group, 7% work environment, 58% as salary and 24% as
supervision. Then the workers were asked whether they are satisfied with the
grievance redressal system or not 28% of skilled workers gave answer as very
true, 48% as true, 20% as partly true and 4% as not true. On the other hand
unskilled workers gave answer as 12% very true, 53% true and 35% as partly
true.

5.7 CONCLUSION:

So in simpler words we can conclude that Grievance is such a situation which

leads to dissatisfaction among the workers working in an organization which can
be due to many reasons such as dissatisfaction related to working conditions,
management policy, violation of rules and regulations etc. And if these
grievances are not heard and redressed properly can lead to various industrial
disputes like lockouts, strikes, boycott, gherao etc. So in order to avoid such
conditions every organization has its own grievance handling procedure and a
proper grievance handling procedure helps in maintaining good industrial
relations between management and workers. Trade unions formed in
organizations also play a vital role in promoting and protecting interests of
workers and thus maintaining cordial relations between workers and management
of that organization. If in case, industrial disputes are not settled easily then they
are settled through various measures like conciliation, arbitration etc.

So Keeping in view the general grievance and grievance handling procedures it is

found that CPP is also having a set grievance handling procedure in its
organization but through the feedbacks being received through the above tables it
can be concluded that many unskilled workers in comparison with the skilled
workers are not very much aware about the grievance redressal committee
present in CPP, how it works and how it can be helpful to them and due to their
ignorance only they are not satisfied with the redressal committee.
 127

REFERENCES:

1. Jucius, Michael J. (1978). Personnel Management. D. B Taraporevala

Sons & Company. Bombay. P- 459.

2. Government of India. (1969). Report of the National Commission of

Labour. Ministry of Labour, Employment and Rehabilitation. New Delhi.

3. Khanka, S.S. (2009). Human Resource Management. S Chand &

Company Ltd. Delhi. P-267.

4. Kapoor T. N. (ed.) (1968). Personnel Management and Industrial

Relations in India. Tripathi & Sons. Bombay. P- 106.

5. Singh V. B. (1966). Climate for Industrial Relations. Asia Publishing

House. Bombay. P- 9:10.

6. Patterson. (1948). Social Aspects of Industry. Oxford University Press.

Bombay. P- 388.

7. Section 2(a) of the Industrial Disputes Act, 1947.

8. Section 2(i) of the Industrial Disputes Act, 1947.

9. http://dictionary.reference.com/browse/gherao.

10. http://www.legalserviceindia.com/articles/ind_dis.htm.

11. Flippo Edwin B. (1989). Personnel Management. McGraw Hill. New

York. P- 378.

12. Section 2(h) of the Trade Unions Act, 1926.

******
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Chapter 6

PROBLEMS AND DIFFICULTIES

There are various problems and difficulties being faced by the employees of
Century Pulp & Paper Mill, Lalkuan. Through the feedback of employees
received from the questionnaire it was seen that the unskilled workers or the
workers being appointed on the contract basis by the mill are facing much more
problems than the skilled or permanent employees.

Government of India has enacted Factories Act, 1948 which provides various
provisions for the welfare of employees and these provisions can be correlated
with the problems being faced by the employees in CPP. The various problems
and difficulties faced by the employees of CPP can be broadly seen as:

1. Problems related with Health: “Health is Wealth” according to this famous

proverb it is clearly stated that health is much more important than wealth and
only a healthy person is able to work efficiently and earn sufficient wages and
salaries for his survival. Factories Act 1948 has various provisions under
Health such as Cleanliness, Ventilation, Lightning, Drinking water etc.

The provisions are as follows1:

i. Section 11 of Factories Act, lays down that every factory shall be kept
clean and free from effluvia arising from any drain, privy or other
nuisance.

ii. According to Section 13(1) effective and suitable provision shall be made
in every factory for securing and maintaining in every work-room :

a. Adequate ventilation by the circulation of the fresh air, and

b. Such a temperature as will secure to workers therein

reasonable conditions of comfort and prevent injury to health.

iii. Section 14(1) deals with the effective measures which should be adopted
to keep the work-rooms free from dust and fume. Every factory in which
by reason of the manufacturing process carried on, there is given off any
dust or fume or other impurity of such a nature and to such an extend as is
likely to be injurious or offensive to the workers employed therein, or any
 129

dust in substantial quantities, effective measures shall be taken to prevent

its inhalation and accumulation in any work room. If any exhaust
appliance is necessary for the above purposes, it shall be applied as near
as possible to the point of origin of the dust, fume or other impurity and
such point shall be enclosed as far as possible.

iv. Section 17(1) provides that in every part of the factory, where workers are
working or passing, there shall be provided and maintained sufficient and
suitable lightning, natural, artificial or both.

v. Section 18 deals with the provisions relating to arrangements for drinking

water in factories. Sub-section (1) provides that in every factory effective
arrangements shall be made to provide and maintain at suitable points
conveniently situated for all workers employed therein, a sufficient supply
of wholesome drinking water.

vi. Section 19(1) provides that in every factory-

a. sufficient latrine and urinal accommodation of prescribed type shall be

provided conveniently situated and accessible to workers at all times
while they are at the factory;

b. separate enclosed accommodation shall be provided for male and

female workers;

c. such accommodation shall be adequately lighted and ventilated, and

no latrine or urinal, shall, unless specially exempted in writing by the
Chief Inspector, communicate with any work-room expect through an
intervening open space or ventilated passage;

d. all such accommodation shall be maintained in a clean and sanitary

condition at all times;

e. sweepers shall be employed whose primary duty would be keep clean

latrines, urinals and work-places.

While going through the provisions given under the Act, and comparing it with
the provisions being given in CPP, researcher found that working conditions and
safety needs of some employees is a big problem for them as the mazdoors or
unskilled workers working in open yards, engaged in unloading of bagasse,
wood, coal, soft stone powder etc face different problems like:
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a) No proper arrangement of sitting, storing clothes & tiffins.

b) No proper facility of lunch rooms is being provided to the contract

labours.

c) The workmen working in open areas face problems due to rain,

temperature, cold, storm etc. which affects their health and capacity too.

d) Workers working in coal areas, soft stone powder unloading area, wood &
bagasse unloading area face dust problems for which they need
soap/detergent and oil to clean their body as well as clothes but no such
arrangements are available.

e) Medical checkup of all permanent workmen is arranged once a year in

company’s dispensary while unskilled workers are not provided with such
facility.

2. Problems related to Safety Needs: Every worker wants to work in a safe

and secure environment. As if he’ll be sure about his safety and security
while working he will be able to concentrate properly in his work and in turn
will be able to give his best to the organization.

Under the Factories Act, 1948 various provisions come under Safety which are
as2:

i. According to Section 21(1) in every factory the following shall be

securely fenced by safeguards of substantial construction which shall be
constantly maintained and kept in position while the parts of machinery
they are fencing are in motion or in use :-

a. every moving part of a primary mover and every fly wheel connected
to a prime mover, whether the prime mover or flywheel is in the
engine house or not;

b. headrace and trailrace of every water-wheel and water-turbine;

c. any part of a stock bar which projects beyond the head stock of a
lathe; and

d. unless they are in such position or of such construction as to be safe to

every person employed in the factory as they would be if they are
securely fenced, the following shall also be securely fenced :-
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• every part of an electric generator, a motor or rotary

converter;

• every part of transmission machinery; and

• every dangerous part of any other machinery.

ii. Section 33(1) provides that in every factory every fixed vessel, sump,
tank, pit or opening in the ground or in a floor which, by reason of its
depth, situation, construction or contents is or may be a source of danger,
shall be either securely covered or securely fenced.

iii. Section 34(1) lays down that no person shall be employed in any factory
to lift, carry or move any load so heavy as to be likely to cause him injury.

iv. Section 35 provides that in respect of any such manufacturing process

carried on in any factory as may be prescribed, the State Government may
by rules require that effective screens or suitable goggles shall be
provided for the protection of persons employed on, or in the immediate
vicinity of the process, provided such process involves :-

a. risk of injury to the eyes from particles or fragments thrown

off in the course of process, or

b. risk to the eyes by reason of exposure to excessive light.

v. Section 37(1) lays down that wherein any factory any manufacturing
process produces dust , gas, fume or vapour of such character and to such
extend as to be likely to explode on ignition, all practicable measures shall
be taken to prevent any such explosion by-

a. effective enclosure of the plant or machinery used in the

process;

b. removal or prevention of the accumulation of such dust, gas,

fume or vapour;

c. exclusion or effective enclosure of all possible sources of

ignition.

vi. Under Section 38(1), in every factory, all practicable measures shall be
taken to prevent outbreak of fire and its spread, both internally and
externally, and to provide and maintain-
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a. safe means of escape for all persons in the event of a fire, and

b. the necessary equipment and facilities for extinguishing fire.

Every person wants his and his family member’s life to be safe and secure. The
work he takes to live his livelihood s also taken by keeping the safety issues in
mind. So while going through the various provisions being lead up in the for the
safety measures under factories act it is being found that the workers, specially
the unskilled workers who are engaged basically in physical work are facing
various problems which are as:

a) Dust masks, goggles etc are provided to some mazdoors or unskilled

workers, but it is not practical to wear dust mask continuously so many a
times they work without them which affects their health.

b) The mazdoors need soap, oil etc but no facility is available to clean their
body and safeguard their skin.

c) Though the workers are provided with safety appliances but to maintain,
store, clean or save them is very difficult to them.

d) Dust is the main problem being faced by the workers which causes
various inhaling problems.

e) The mazdoors sometime face problem due to their carelessness,

overconfidence or disobedience habits.

3. Problems related to Wages: A worker works in an organization with the

hope of getting wages or salaries in return to lead a happy and prosperous life.
If employees are being provided with sufficient wages they work more
effectively and efficiently to fulfill the organizational goal and be loyal to the
organization. To secure the welfare of the workers in the present competitive
market, The Minimum Wages Act was passed in the year 1948, which
ensures in fixation of minimum wages which an employee must get from his
employer.

In a developing country like ours which faces the problem of unemployment on a

very large scale it is not unlikely that labour may offer to work even on starvation
wages. The policy of the Act, therefore, is to prevent employment of sweated
labour in the general interest and, so, in prescribing the minimum wages rates, the
capacity of the employer need not be considered as the State assumes that every
employer must pay the minimum wages for the employee’s labour.3
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Salient features of the Act4:-

1) The Act provides for the fixation of: (a) minimum time rate of wages; (b)
a minimum piece rate; (c) a guaranteed time rate; (d) an overtime rate, for
different occupations, localities or classes of work and for adults,
adolescents, children and apprentices.

2) The minimum rate of wages under the Act may consist of: (a) a basic rate
of wages and a cost of living allowance; or (b) basic rate of wages with or
without the cost of living allowance and the cash value of the concessions
in respect of essential commodities supplied at concessional rates; or (c)
an all-inclusive rate.

3) The Act requires that wages shall be paid in cash, although it empowers
the appropriate Government to authorise the payment of minimum wages,
either wholly or partly in kind in particular cases.

4) It lays down that the cost of living allowance and the cash value of the
concessions in respect of supplies of essential commodities at
concessional rates shall be computed by the competent authority at certain
interval. In case of undertakings controlled by the Union Territories and
the Central Government, the Director, Labour Bureau is the competent
authority.

5) The Act empowers the appropriate Government to fix the number of

hours of work per day, to provide for a weekly holiday and the payment
of overtime wages in regard to any Scheduled employment in respect of
which minimum rates of wages have been fixed under the Act.

6) The establishments covered by this Act are required to maintain registers

and records in the prescribed manner.

7) The Act also provides for appointment of Inspectors and authorities to

hear and decide claims arising out of payment of wages at less than the
minimum rates of wages or remuneration for days of rest or of work done
on such days or of overtime wages.

8) The provision is also made in the Act for dealing with complaints made
for violation of the provisions of the Act and for imposing penalties for
offences committed under the Act.

Under CPP the unskilled workers are facing more problems related to wages in
comparison to skilled employees, as they are not been given the grade pay,
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dearness allowance etc. With the rise in prices, the workers hope for increase in
wages to live their livelihood and maintain their status in the society. And if not
provided with the increased wages the employees’ efficiency also decreases and
gives rise to industrial disputes. Problems faced by workers regarding their wages
in CPP are as:

a) Short attendance shown by the supervisor or contractor results in

deduction in total wages.

b) Sometimes it is observed that the supervisor or contractor cut their one or

two day’s wages for their own benefit, while money receiving remains ok.

c) At some jobs there is no surety to get regular duty, many a time labour
present themselves at duty but the contractor refuses to engage them by
giving whatsoever reason.

d) Contractor may ask employees not to attend duty any day or days.

e) Transfer from one site to other site or one type of job to other type of job
by the contractor makes it inconvenient for the workers.

f) The contract labour depends on minimum wages fixed and revised time to
time by Government but in view of present market conditions it can be
concluded that life of these labours is very tough and problemetic. These
minimum wages or the wages are paid at the will of contractor to the
contract workers which are not even equal to the permanent worker of the
same cadre.

g) No future security for permanent job is given to the contract labours. If

contractor of the mill changes the workers are shifted to the new
contractor. Any argument or discussion by the contract worker regarding
their rights of job or against the any change in his job he may face various
problems. Even he might be asked to quit the job.

h) As the contract workers are not allowed for any kind of casual, sick and
earned leave, so in case of any domestic or personal problem the
workmen remains absent from his duty and didn’t get any wages or
allowance for the day or days which creates a big economical problem
before him.

4. Problems related to Social Security: The quest for social security and
freedom from want and distress has been the consistent urge of man through
the ages. This urge has assumed several forms according to the needs of the
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people and their level of social consciousness, the advancement of technology

and the peace of economic development.5 “Social security envisages that the
members of a community shall be protected by collective action against social
risks causing undue hardship and privation to individuals whose private
resources can seldom be adequate to meet them. It covers through an
appropriate organisation, certain risks to which a person is exposed”6. “These
risks are such that an individual of small means cannot effectively provide for
them by his own ability or foresight alone or even in private combination with
his colleagues”.7

Social security not only protects the employee but also his entire family by
providing benefits in financial security and health care. Social security guarantees
at least long term sustenance to the families in case when their earning member
dies, retires or suffers from any disability. Hence social security helps in
providing the people insurance and assistance for their own future. The success of
such schemes depends on the mutual and active support of both employer and
employee.

The principal social security laws enacted in India are the following8:

1. The Employees’ State Insurance Act, 1948 (ESI Act) which covers
factories and establishments with 10 or more employees and provides for
comprehensive medical care to the employees and their families as well as
cash benefits during sickness and maternity, and monthly payments in
case of death or disablement.

2. The Employees’ Provident Funds & Miscellaneous Provisions Act, 1952

(EPF & MP Act) which applies to specific scheduled factories and
establishments employing 20 or more employees and ensures terminal
benefits to provident fund, superannuation pension, and family pension in
case of death during service. Separate laws exist for similar benefits for
the workers in the coal mines and tea plantations.

3. The Employees' Compensation Act, 1923 (WC Act), which requires

payment of compensation to the workman or his family in cases of
employment related injuries resulting in death or disability.

4. The Maternity Benefit Act, 1961 (M.B. Act), which provides for 12
weeks wages during maternity as well as paid leave in certain other
related contingencies.
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5. The Payment of Gratuity Act, 1972 (P.G. Act), which provides 15 days
wages for each year of service to employees who have worked for five
years or more in establishments having a minimum of 10 workers.

In many of the developed countries social security schemes are linked to wage
employment but in our country the situation is all different as there is no
universal social security system existing here. Approx, 92% of the total
workforce in India, work under the informal sector which is largely unrecorded
and thus creates difficulty in system of payroll deductions.

In CPP this problem is not seen among the skilled employees but the unskilled
ones appointed on the contract basis suffer it. The job of unskilled worker is
secured only till the contractor has his agreement of supplying the labours to the
plant on contract basis. This is the loss for both employee and organization. CPP
provides various fund facilities to their permanent and skilled employees like
medi claim policy (provided to them, their wives and two children below 21
years of age) ,rehabilitation funds, group personal accident policy etc. But here
again the unskilled workers are deprived from such benefits. Some of such
problems faced by the contract workers are as:

a) Benefits of ESI are available for these workers but to avail these benefits
long procedures formalities and time makes it difficult.

b) The uneducated workers even face the problem in getting the benefits
under ESI Act and have to depend on the guidance of others to avail such
benefit.

c) No medi claim or life insurance facility is provided to the workers other

than ESI.

d) If any worker meets with an accident outside the mill campus then he has
to spend all the expenditure on his treatment by his own. Contractor or
any other person can help him by providing him loan.

e) In view of the good hospital facilities, most of the treatments are taken at
Haldwani, Rudrapur or Bareilly which becomes major problem for the
workmen to meet the expenditure of medical treatment of his or his
family member in these places far away from their working place.

5. Problems related to housing: Out of three basic necessities of life that is:
food, clothing and shelter; shelter is very important for human survival.
Proper housing facility helps in improving physical and mental health of the
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employee and thus helps in keeping up his morale. Healthy, safe and
comfortable residential area helps in both physical and mental development
of the employee. In present era industrialization and increasing cost of
construction of houses has given a rise to problems related to housing. Due o
these problems employees who come to other places for their job have to pay
unnecessary increased rent for the houses taken on rent. Even the houses
provided by the land lord are also not in good condition i.e. having no proper
facility of lightening, ventilation and neatness. According to Worker’s
Housing Recommendation, 1961 (No. 115), the 45th ILC session (28 Jun
1961) recommends that each member should, within the framework of its
general social and economic policy, give effect to the following General
Principles in such manner as may be appropriate under national conditions:9

Housing Standards: As a general principle, the competent authority should, in

order to ensure structural safety and reasonable levels of decency, hygiene and
comfort, establish minimum housing standards in the light of local conditions and
take appropriate measures to enforce these standards.

General Considerations:

1. The housing standards referred in Housing Standards above should relate

in particular to-

a. the minimum space per person or per family as expressed in terms of

one or more of the following, due regard being had to the need for
rooms of reasonable dimensions and proportions:

i. floor area;

ii. cubic volume; or

iii. size and number of rooms;

b. the supply of safe water in the workers' dwelling in such ample

quantities as to provide for all personal and household uses;

c. adequate sewage and garbage disposal systems;

d. appropriate protection against heat, cold, damp, noise, fire, and

disease-carrying animals, and, in particular, insects;

e. adequate sanitary and washing facilities, ventilation, cooking and

storage facilities and natural and artificial lighting;
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f. a minimum degree of privacy both-

i. as between individual persons within the household; and

ii. for the members of the household against undue disturbance

by external factors; and

g. suitable separation of rooms devoted to living purposes from quarters

for animals.

2. Where housing accommodation for single workers or workers separated

from their families is collective, the competent authority should establish
housing standards providing, as a minimum, for-

a. A separate bed for each worker;

b. Separate accommodation of the sexes;

c. Adequate supply of safe water;

d. adequate drainage and sanitary conveniences;

e. adequate ventilation and, where appropriate, heating; and

f. common dining rooms, canteens, rest and recreation rooms and health
facilities, where not otherwise available in the community.

3. Workers' housing standards should be revised from time to time to take

account of social, economic and technical development and increases of
real income per head.

4. In general, and in localities where employment opportunities are not of a

temporary character, workers' housing and related community facilities
should be of durable construction.

5. The aim should be to construct workers' housing and related community

facilities in the most suitable materials available, having regard to local
conditions, such as liability to earthquakes.

In case, housing facility is not provided to the workers, House Rent Allowance
(HRA) is being paid to them. Here in CPP skilled or permanent workers are
provided with housing facilities and if they don’t take the housing facility they
are given HRA (House Rent Allowance) but the contract or unskilled workers
have to search their shelter themselves as many of them are migrants. They are
not provided with housing facilities or HRA, which forces them to live in
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unhealthy environment as their wages are not sufficient to pay the higher rents
demanded by the landlords. So the contract labours are compelled to live in slums
or huts. They even can’t keep their families with them as these slum areas always
face basic problems of water, light, cleanliness and even theft cases are seen.

No transportation facility is available to the contract employees to reach the mill

from their residential places while the permanent employees are provided with
this facility.

6. Problems related to education of employees wards: Education is one of the

most essential need for the society. An uneducated person is just a liability for
his family, society and nation. Even due to the importance of education only
the government of India has made a provision of Free and Compulsory
Elementary Education up to the age of 14 years under one of its program i.e.
Sarva Shiksha Abhiyan. Government of India under Ministry of Labour and
Employment has led down the provision that employees should be paid
monthly education allowance to their wards studying in schools or colleges.

No schooling facility is provided inside the factory campus for the wards of
workers working in the mill. Every contract labour living with his family sends
his ward to Government schools, colleges or some low paid private schools or
some families remain at their villages only. Few labours also send their wards to
the nearby cities for fulfilling their educational needs. But in this case no
transportation facility is provided to these children either by the contractor or by
the company.

7. Problems related to medical needs: “Health is Wealth” according to this

famous proverb it is clearly stated that health is much more important than
wealth and only a healthy person is able to work efficiently and earn
sufficient wages and salaries for his survival. The provisions for medical
related needs under the Employee State Insurance Act, (ESIC) 1948, are as:10

The Employee State Insurance Act, (ESIC) 1948, is a piece of social welfare
legislation enacted primarily with the object of providing certain benefits to
employees in case of sickness, maternity and employment injury and also to
make provision for certain others matters incidental thereto. The Act in fact tries
to attain the goal of socio-economic justice enshrined in the Directive principles
of state policy under part 4 of our constitution, in particular articles 41, 42 and 43
which enjoin the state to make effective provision for securing, the right to work,
 140

to education and public assistance in cases of unemployment, old age, sickness

and disablement. The act strives to materialize these avowed objects through only
to a limited extent. This act becomes a wider spectrum than factory act. In the
sense that while the factory act concerns with the health, safety, welfare, leave etc
of the workers employed in the factory premises only. But the benefits of this act
extend to employees whether working inside the factory or establishment or
elsewhere or they are directly employed by the principal employee or through an
intermediate agency, if the employment is incidental or in connection with the
factory or establishment.

Benefits under the Scheme

Employees covered under the scheme are entitled to medical facilities for self and
dependants. They are also entitled to cash benefits in the event of specified
contingencies resulting in loss of wages or earning capacity. The insured women
are entitled to maternity benefit for confinement. Where death of an insured
employee occurs due to employment injury or occupational disease, the
dependants are entitled to family pension. Various benefits that the insured
employees and their dependants are entitled to, the duration of benefits and
contributory conditions thereof are as under:

1. Medical Benefits

• From day one of entering insurable employment for self and dependants
such as spouse, parents and children own or adopted.

• For self and spouse on superannuation subject to having completed five

years in insurable employment on superannuation or in case of having
suffered permanent physical disablement during the course of insurable
employment.

2. Sickness Benefits

• Sickness benefit is payable to an insured person in cash, in the event of

sickness resulting in absence from work and duly certified by an
authorised insurable medical officer/practitioner.

• The benefit becomes admissible only after an insured has paid

contribution for at least 78 days in a contribution period of 6 months.
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• Sickness benefit is payable for a maximum of 91 days in two consecutive

contribution period.

3. Extended Sickness Benefit

• Extended sickness benefit is payable to insured persons for the period of

certified sickness in case of specified 34 long-term diseases that need
prolonged treatment and absence from work on medical advice.

• For entitlement to this benefit an insured person should have been in

insurable employment for at least 2 years. He/ she should also have paid
contribution for a minimum of 156 days in the preceding 4 contribution
periods or say 2 years.

• ESI is payable for a maximum period of 2 years on the basis of proper

medical certification and authentication by the designated authority.

• Amount payable in cash as extended sickness benefit is payable within 7

days following the submission of complete claim papers at the local office
concerned.

4. Enhanced Sickness Benefit

• This cash benefit is payable to insured persons in the productive age

group for undergoing sterilization operation, viz., vasectomy/ tubectomy.

• The contribution is the same as for the normal sickness benefit.

• Enhanced sickness benefit is payable for 14 days for tubectomy and for
seven days in case of vasectomy.

5. Maternity Benefit

• Maternity benefit is payable to insured women in case of confinement or

miscarriage or sickness related thereto.

• For claiming this an insured woman should have paid for at least 70 days
in 2 consecutive contribution periods i.e. 1 year.

• The benefit is normally payable for 12 weeks, which can be further

extended up to 16 weeks on medical grounds.
 142

• The rate of payment of the benefit is equal to wage or double the standard
sickness benefit rate.

• The benefit is payable within 14 days of duly authenticated claim papers.

6. Disablement Benefit

• Disablement benefit is payable to insured employees suffering from

physical disablement due to employment injury or occupation disease.

7. Dependants Benefit

• Dependants benefit [family pension] is payable to dependants of a

deceased insured person where death occurs due to employment or
occupational disease.

• A widow can receive this benefit on a monthly basis for life or till
remarriage.

• A son or daughter can receive this benefit till 18 years of age.

• Other dependants like parents including a widowed mother can also

receive the benefit under certain condition.

• The rate of payment is about 70% of the wages shareable among

dependants in a fixed ratio.

• The first installment is payable within a maximum of 3 months following

the death of an insured person and thereafter, on a regular monthly basis.

8. Other benefits like funeral expenses, vocational rehabilitation, free supply of

physical aids and appliances, preventive health care and medical bonus.

Obligations Of Employers

1. The employer should get his factory or establishments registered with the
E.S.I. Corporation within 15 days after the Act becomes applicable to it, and
obtain the employers Code Number.

2. The employer should obtain the declaration form from the employees covered
under the Act and submit the same along with the return of declaration forms,
to the E.S.I. office. He should arrange for the allotment of Insurance Numbers
to the employees and their Identity Cards.
 143

3. The employer should deposit the employees’ and his own contributions to the
E.S.I. Accounting the prescribed manner, whether he has sufficient resources
or not, his liability under the Act cannot be disputed. He cannot justify non-
payment of E.S.I. contribution due to non availability of finance.

4. The employer should furnish a Return of Contribution along with the challans
of monthly payment, within 30 days of the end of each contribution period.

5. The employer should not reduce the wages of an employee on account of the
contribution payable by him (employer).

6. The employer should cause to be maintained the prescribed records/registers

namely the register of employees, the inspection book and the accident book.

7. The employer should report to the E.S.I. authorities of any accident in the
place of employment, within 24 hours or immediately in case of serious or
fatal accidents. He should make arrangements for first aid and transportation
of the employee to the hospital. He should also furnish to the authorities such
further information and particulars of an accident as may be required.

8. The employer should inform the local office and the nearest E.S.I.
dispensary/hospital, in case of death of any employee, immediately.

9. The employer must not put to work any sick employee and allow him leave, if
he has been issued the prescribed certificate.

10. The employer should not dismiss or discharge any employee during the
period he/she is in receipt of sickness/maternity/temporary disablement
benefit, or is under medical treatment, or is absent from work as a result of
illness duly certified or due to pregnancy or confinement.

CPP has provided its employees with a first aid centre within its campus.
Employees can only get the first aid facility there. In case of any emergency they
have to refer to other hospitals in nearby cities like Rudrapur, Haldwani etc.
Ambulance facility is provided to the employees by the company. No further
benefits covered under the various acts laid up by the Government of India or
State is being provided to the contract labours. Even the contract labours have no
facility to avail sick leave, casual leave or earn leave, hence if they have any
urgent domestic work or any causality in family or ill health they have to work in
such condition also as remaining absent from duty reduces their earning.

8. Problems related to environmental pollution: Environment comprises of

the surrounding, conditions and influences where we live. Every individual
 144

wants the environment where he lives to be safe, healthy and comfortable.

Section 12(1) of Factor’s Act lays down, that effective arrangements shall be
made in every factory for the treatment of wastes and effluents due to the
manufacturing process carried on therein, so as to render them innocuous, and
for their disposal.

Due to the establishment of CPP mill in Lalkuan surrounding environment has

become polluted. The smoke coming out of the mill has given rise to air pollution
and the effluents coming out of the factory pollutes the nearby water. The
eucalyptus trees grown in the nearby area for getting raw material for the mill is
also responsible for the decrease in underground water level which in turn is
giving rise to the shortage of water availability in the nearby areas. Moreover the
foul smell coming from the mill has become a nuisance for the people living
there as well as the one passing from the Lalkuan city.

Hence keeping in view the different security and welfare acts of the Government
of India or State, the question arises that whether the factory (Century Pulp &
Paper Mill, Lalkuan) follows the norms laid down in these acts or not. And while
going through the above research, it would be pertinent to say that the unskilled
workers fall under the unorganized sector and that’s why they could not present
their grievances before a suitable authority. As there is no grievance handling
system for the contract labours and in case of any injustice or misbehave from the
contractor or contractor’s supervisor workers are only the sufferer and at loss.
Practically it becomes difficult for them to take legal stand against contactor or
management. The contract workers have nothing to prove the charges against the
contractor as they neither have money nor any support of trade unions or various
organizations. Therefore it can be concluded that the working conditions for
skilled or permanent workers in CPP is not so tough in comparison to the
unskilled ones. As the unskilled or the contract workers are being deprived from
the various benefits which an employee should get from his job. Even their jobs
are also not secured in CPP. They are fully dependent on the agreement of their
contractor with the Mill.

After going through the various provisions being laid up by the government of
India or State and the problems being faced by the contract workers in CPP on
non fulfillment of these provisions let us go through some of the Facilities being
provided by CPP to the contract workers in normal course as implementation of
laws along with the problems being faced by the management in providing such
facilities to their employees.

Facilities being provided to the employees in CPP are as:

 145

1. Fix duty hours.

2. Payment for overtime.

3. Proper lightning and drinking water.

4. Number of urinals and latrines are maintained.

5. Card and register for attendance, wages etc which are being checked y the
company staff from time to time.

6. Subsidized tea, snacks and breakfast.

7. Personal protective equipments being provided to each workman

(helmets, goggles, ear plugs, safety belts, dust masks etc.)

8. Actual PF and ESL contribution deduction from contractor’s bills and

proper management to deposit it to concern departments.

9. Checking and arranging payment in presence of company staff.

10. Bonus payment to contract labour.

11. Help in taking advance from PF.

12. Help in pension formalities.

13. The company staff helps the employees in getting ESI benefits and
fulfilling the formalities required.

14. Medical consultancy at company dispensary free of cost.

15. Some wage increment at the time of tri yearly agreements with trade
unions.

16. Awareness training to upkeep the general and safety knowledge is given
by CPP staff.

17. Company working for community development y facilitating the people

of surrounding in education, health, social and agricultural areas.

Problems being faced by management of CPP in providing such facilities to their

employees other than routine jobs are as:

1. Control Absenteeism.

2. Control leaves.
 146

3. Maintain discipline (in-out time, leaving duty place, quarreling etc)

4. Control on overtime work.

5. Implementation of safety measures or enforcement of the policy to adopt

or use PPEs.

6. In case of any misconduct it becomes difficult to prove it.

7. To ask quick and in-time work to employees.

8. To maintain cleanliness and control the sabotage, theft by any reason

knowingly or unknowingly.

9. Late arrival of staff buses in shifts.

10. Transportation of employees wards to different schools at different

timings.

11. Control advance against wages to permanent workers.

12. Difficulty in vacating the rooms and unauthorized occupation of quarters.

13. Problem of cleaning the residential colonies and drinking water.

14. Inter-union rivalry creates problem in quarter allotment, promotions,

increment, transfer etc.

15. Disposal of solid wastes.

16. Disposal of effluent water.

17. Bad smell and dust management.

Therefore, by observing the above points researcher comes to the conclusion that
the facilities being provided to the employees in CPP fall under the provision of
various laws and the management in turn has to face various problems in
fulfilling these facilities but then also the workers specially the contract workers
are not able to get all the benefits being provided by the company as the contract
workers are the whole sole responsibility of the contractors and what so ever is
being provided to the workers goes through them only, so it is possible that the
unskilled or the contract workers are deprived from such benefits due to this
reason only. Hence in short it can be concluded that due to the various working
and socio-economic problems mentioned in the chapter the life of the workers,
especially unskilled workers and their family becomes tough for them.
 147

REFERENCES:

1. Mishra, S. N. (2005). Labour & Industrial Laws. Central Law

Publications. Allahabad. P 642-645.

2. Ibid. P 646-654.

3. Crown Aluminium Works v. Their Workmen. AIR (1958). SC 30.

4. Mishra, S. N. (2005). Labour & Industrial Laws. Central Law

Publications. Allahabad. P-553.

5. Report of the National Commission on Labour. (1969). P-162

6. Ibid

7. I.L.O. Approaches to Social Security. (1942). P-80. Quoted in Report of

the National Commission on Labour. (1969). P-162

8. http://www.labour.nic.in/content/division/social-security.php

9. http://www.ilo.org/dyn/normlex/en/f?p=NORMLEXPUB:12100:0::NO::P
12100_INSTRUMENT_ID:312453

10. http://www.nacib.in/pdf/Labour%20Act.pdf

********
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Chapter 7

CONCLUSION

Human Resource Management is the most vital need of every organization.

Every organization whether profit earning or non-profit earning, large scale or
small scale need a proper human resource management to achieve their
predetermined objectives. In India there are various large scale, medium scale
and small scale industries which mostly have their well defined human resource
department to manage their most important factor of production i.e. human. HRM
includes various managerial and operative functions, which when properly
handled leads the organization towards prosperity. In the earlier chapters of the
thesis, researcher looked upon these functions of HRM minutely in accordance to
the general theory as well as to the HRM being practiced in Century Pulp &
Paper Mill Lalkuan, a well known large scale industry of Uttarakhand which was
set up in the year 1984 manufacturing bagasse based paper used throughout the
country. While going through the research in CPP it was found that out of the
total working force in CPP some are categorized as skilled or permanent workers
while other come under the category of unskilled or contract workers, appointed
through different contractors.

The main purpose of this study is to find out the HRM practices being followed
in CPP and the various problems and difficulties being faced by the workers due
to these practices. For this the researcher used primary data which were collected
through questionnaires cum schedules and while collection of the data researcher
faced few constraints also, as the workers skilled as well as unskilled were not
ready to answer the question being presented to them. The total workforce in CPP
is approx 2919 out of which some workers are skilled and permanent ones while
some are unskilled, appointed by the different contractors. The HR Department of
CPP is being divided into different departments according to their activities such
as Training & Development, Quality Circle, Safety etc.

The primary function of HRM is human resource planning which is also known
as a forward looking function as it consists of estimation of manpower
requirements of an enterprise. HR planning is neither static nor rigid as every
organization has its own manpower requirement and its own way to fulfill that
requirement. Various methods and techniques are used in forecasting the demand
 149

and supply of manpower resource and so is done in CPP. Combination of various

such methods and techniques are used in CPP. While going through the feedback
of the workers in CPP it was found that the executive class of CPP is well aware
of the of the different departments of CPP along with their inter linkage while on
the other hand workers specially unskilled workers are not very clear about the
tasks and objectives of CPP. They feel that the HR Department is not providing
them the welfare services more effectively and if any such service is provided to
them it is not easily accessible to the unskilled workers in comparison to the
skilled ones. Even the workers feel that the internal applicants are not provided
with good opportunities for recruitment and selection process in comparison to
the external applicants. Unskilled workers even feel that the test and interview
techniques are more biased than the skilled ones.

After Human Resource Planning the next function of HRM is Recruitment,

Selection and Training which are the integral part of HRM. Recruitment is the
process of finding and then attracting the most capable applicant for the required
vacancy. There are different sources of recruitment which are divided into two
parts i.e. internal source and external source. It depends on the organization that
which source is being used by them. Selection is also known as negative function
as it includes rejection. The capable applicants are retained in the organization
while the incapable ones are rejected. Once the selection process is completed the
selected applicants are provided with the proper training in order to increase their
knowledge and skill in performing a particular task. CPP also has its well defined
and documented recruitment and selection policy and procedure which include
various steps. But while going through the questions being put up by the
researcher regarding the recruitment, selection and training procedure being
followed in CPP, the researcher found that the executives are satisfied with the
recruitment & selection procedure being followed in the organization while on
the other hand both the skilled as well as unskilled workers have same view on
this procedure only the unskilled workers are not satisfied with the job
explanation to them during the time of induction and the information being
provided to them for the upcoming training session.

Once the recruitment, selection and training process is completed the next HRM
function is Motivation, which includes motivating and inspiring the workers to
work in the desired manner to complete the given task. Motivated workers give
their best in comparison to the workers who are pressurized to do any given
work. Motivation helps in increasing the productivity of a worker. Different
 150

philosophers and thinkers like Maslow, Herzberg, porter & Lawler etc have given
their own theories on motivation and CPP uses some part of different theories to
motivate their employees. Various tools like quality circles, worker’s
participation in management etc are also used in CPP to motivate its employees.
While going through the feedback of employees and the executives it was seen
that most of the executives are satisfied with the motivational policy of CPP. And
in case of workers both skilled and unskilled workers have same view regarding
the motivational policy in CPP but unskilled workers are given lesser
opportunities to express their views to the upper management regarding any of
the grievances or suggestions and if given any chance the proper weightage is not
given to their suggestions. Most of the unskilled workers need both monetary as
well as non monetary incentives as a motivational factor.

When workers are motivated properly in an organization they give their best
without any complains but if the motivational factor is not present or workers are
dissatisfied with any policy of the firm, in this case the situation leads to
grievances among the workers. Grievances among the workers can be due to any
of the reason such as dissatisfaction related to the working conditions,
management policy, violation of rules and regulations etc. And in case these
grievances are not handled properly can lead to various industrial disputes like
strikes, lockouts, gherao etc. in order to avoid these disputes every organization
has its own grievance redressal procedure which helps in maintaining the cordial
relations between the management and the workers. CPP also has its own
grievance handling procedure. The company tries to settle the grievances among
workers through a proper channel but when the workers were asked questions
about the grievance handling procedure in CPP their feedback was different for
executives, skilled and unskilled workers. Executives when were asked about the
grievance procedure in CPP they were satisfied with the procedure and told that
the frequency of grievances is also not very high in the company and if they
receive any grievance it is related mostly with the work group and then to the
supervision. According to them proper records are maintained for the grievance
settlement. On the other hand through the feedback of workers skilled as well as
unskilled it is seen that the main cause of grievance among the workers is related
with salary and the workers specially the unskilled ones are not very much aware
of the grievance redressal system of CPP, how it works and how it can be helpful
to them. And due to this ignorance only they are not satisfied with the redressal
committee.
 151

After going through the various functions of HRM in CPP and the feedback of
workers and executives the researcher found the reason for various problems and
difficulties being faced by the workers in CPP. The main problem and difficulties
are being faced by the unskilled or the contract workers in CPP in comparison to
the skilled ones. Basically the problems faced by the unskilled workers are
related with health, their wages, safety needs, social security, housing, education
of their wards medical needs etc. The unskilled workers fall under the
unorganized sector and that’s why they are not able to present their grievances
before a suitable authority. Even in case of any injustice or misbehave by the
contractor or contractor’s supervisor they only suffer the loss. They are deprived
from the various benefits which an employee must get from his job. Even their
jobs are also not secured.

Suggestions: Researcher when asked a general question to employees i.e.

“Towards which area, HR and organization needs to work according to you?”
Through the feedback of various employees various suggestions can be given by
the researcher to the HR Department in CPP as:

1. Chemical based industries which create pollution like CPP should make
sure that the employees are given facilities for the full routine check up
once in a year.

2. Proper treatment facilities should be provided to the employees and for

that well maintained and equipped hospitals should be developed in the
nearby area.

3. Proper canteen facility should be provided to the employees working in

the factory with hygienic and nutritious meals.

4. Insurance limit of the workers should be increased accordingly.

5. How and when to use the safety tools should be taught properly to all the
employees from lower level to upper level.

6. Proper education facility should to be provided to the wards of the

employees working in the organization and the meritorious students
should always be encouraged.

7. Proper education and training should be provided to the employees from

time to time to face any miss happening at the working area and the
 152

employees should always be encouraged to use safety tools while

working.

8. CPP is a chemical based plant, and the machineries used here secrete
pollution for the employees working there as well as the local people
residing nearby so these machineries should be checked from time to time
in order to minimize the pollution.

9. Chemicals, acids, oil etc should not be allowed to pour on the land as it
may degrade quality of the land.

10. To raise the living standard of employees, the organization should try to
keep on updating their employees and should increase their wages
accordingly.

11. The company should keep on organizing various social and religious
gatherings and programmes from time to time as it will help the
employees morally and will make them loyal towards their nation too.

12. Employees those who are hard working should be promoted accordingly.

So, after going through the whole research few suggestions can be given by the
researcher to make the Human Resource Management system of CPP more
strong and successful. As proved in the whole thesis HRM can be said to be the
backbone of every organization so first of all the emphasis should be given to
make the HRM department as strongest as possible. The best, qualified and
experienced candidates should be appointed for the HRM department. Once the
department is filled with the best and talented employees the department should
look forward for the best human resource planning process or the combination of
different processes like work study method, ratio trend analysis, Delphi technique
etc. Human Resource Information System (HRIS) is also a good online solution
for the small to mid-sized businesses. CPP can also use HRIS for fulfilling their
data entry, data tracking and data information needs of human resources to
manage their HR Payroll, management and accounting activities.

Once the Human Resource Planning is done recruitment and selection process
starts. Two main sources of Recruitment process in any organization are external
and internal source. CPP has its specific procedure for the recruitment and
selection process but to get the best employees recruited and selected it is very
necessary to have a well coordination between the two sources as both have their
 153

prose and corns. If any of the sources is overlooked the organization may suffer.
CPP should also look for the well coordinated sources of recruitment and
selection process for their organization. Weightage should be given to both the
internal employees as well external employees. Even the talented freshers should
also be given chance to prove themselves. Training enhances the skills of an
employee. It helps in updating and reviewing the knowledge of employees, so its
significance should not be overlooked. CPP also follows the series of steps to
provide training to its employees. Training sessions in CPP can become more
successful if the identification of training needs will be done on the basis of
organization, tasks to be performed and person to perform those tasks. Once the
training needs are assessed the objectives of training should be set up along with
the training methods. Emphasis should be given to both, On the Job training as
well as Off the Job training.

Motivation acts as a push factor for any employee working in an organization.

Motivation fills the employees with the positive energy to work in the right
direction. Different philosophers have given their different views on the term
motivation and thus have given the different theories but if we will go at the
depth of every theory we may find that each theory correlates with the other. At
last each theory concludes that the motivation is the only mean to get the things
done through others in the most willingly manner. There are different
motivational tools used to motivate employees directly or indirectly in every
organization. CPP also uses different motivational tools to motivate its employees
and the researcher in its research has found that many of the tools are based on
the safety, security and belongingness needs. The basic or physiological needs of
the employees suffer a lot. While in every organization its must to first fulfill all
the basic needs of the employees. Even if we go through the Maslow’s need
hierarchy theory first level of need to be fulfilled of every employee is the basic
or physiological need. So, in order to get the full support of employees CPP
should look forward to fulfill the basic needs of its employees like their housing
needs, education of their wards, transportation needs etc.

Dissatisfaction or any type of sense of injustice leads grievance among the

employees and grievance in turn leads to conflicts and disputes within the
organization. No organization whether small or big can’t say that they don’t face
any type of grievance in their organization and to handle the grievances each
organization follows its on grievance handling procedure. CPP also follows its
own grievance handling procedure. Going through the research, the researcher
 154

found that there are no flaws as such in the grievance handling procedure of the
organization but the only problem is with the awareness of the employees
regarding the present grievance handling procedure in CPP. Many of the
unskilled workers are not aware about how to redress their grievances and due to
this ignorance only they are not satisfied with the redressal committee.

Thus at last it can be concluded that the facilities being provided to the workers in
CPP fall under the provisions of various laws and management tries to provide all
the facilities to its workers but the workers specially the contract workers, who
are the whole sole responsibility of their contractor are the only channel from
where the workers get all the benefits being provided by the company. So it is
possible that due to this channel only the unskilled or the contract workers are not
getting their rights.

*******
 155

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 160

ANNEXURE 1
PRODUCTS AND TYPES OF PRODUCTS PRODUCED IN CENTURY
PULP & PAPER MILL (CPP)
(Source: Century Pulp & Paper Mill, Lalkuan)

WOOD BASED

• Cream Wove (HB)

• Cream Wove (NB)

• Azure-laid wove paper

• Colored wove paper
• Duplicating full size
• Maplitho SS
• Maplitho SS (HB)
• MICR cheque paper

• Maplitho
• Maplitho CARSP
• Maplitho Colored
• Maplitho Deluxe
• Maplitho Superwhite
• Offset printing paper
• Century Bond

• Century Parchment
• Century Super PTG
• Duplicating Cut size
• Dyeline base paper
• Century Copier (cut size) SIS
• Maplitho Deluxe (CG)

• Maplitho base paper

• Chairman bond paper
• Special printing paper
 161

• Account book paper (Yellow)

• Account book paper (white)
• Continuous stationary (HB)
• Wood free printing paper

• Railway bond paper

• Super white cartridge
• Opaline base paper
• Alabaster printing
• White printing paper
 162

ANNEXURE 2
(Source: Century Pulp & Paper Mill, Lalkuan)

ORGANIZATIONA HIERARCHY OF CENTURY PULP & PAPER MILL

(Designation Wise)

Joint President (Works)

Sr. V.P. / Chief Engineer

Vice President

Sr. G.M. (S)

G.M. (S)

D.G.M. (S)

Sr. Manager (S)

Manager (S)

Dy. Manager (S)

Sr. Superintendent (S)

 163

Superintendent (S)

Officer (S)

Graded Staff

HIERARCHY PERSONNEL & ADMINISTRATION OF CENTURY PULP

& PAPER MILL
(Designation Wise)

Vice President

G.M. (Medical)

D.G.M. (P & IR)

Sr. Manager

Manager(S)

Dy. Manager (S)

Sr. Superintendent

Superintendent

Officer
 164

ANNEXURE 3

Qualification and experience for each position in CPP

S. Position/Title Minimum Qualification Years of

No. Experience
1 Officer Graduate Engineer 2 Years
University Diploma in Pulp & Paper 4 Years
Technology/Process
Instt./Mech./Elect./Civil
Polytechnic Diploma 6 Years
M.S.W. 2 Years
2 Supdt. CA / MBA --
Graduate Engineer 8 Years
University Diploma in Pulp & Paper 10 Years
Technology/Process
Instt./Mech./Elect./Civil
Polytechnic Diploma 12 Years
3 Sr. Supdt. CA 3 Years
Graduate Engineer 10 Years
University Diploma in Pulp & Paper 12 Years
Technology/Process
Instt./Mech./Elect./Civil
Polytechnic Diploma 15 Years
4 Dy. Manager CA 5 Years
Graduate Engineer 12 Years
University Diploma in Pulp & Paper 14 Years
Technology/Process
Instt./Mech./Elect./Civil
MBA/M.S.W./PG Diploma in 8-10 Years
Personnel Management/HRM
5 Manager CA 7 Years
Graduate Engineer 12-14 Years
University Diploma in Pulp & Paper 14-16 Years
Technology/Process
Instt./Mech./Elect./Civil
MBA/M.S.W./PG Diploma in 10-12
Personnel Management/HRM Years
 165

6 Dy. General CA 9 Years

Manager Graduate Engineer 14-16 Years
University Diploma in Pulp & Paper 16-18 Years
Technology/Process
Instt./Mech./Elect./Civil
MBA/M.S.W./PG Diploma in 14-16
Personnel Management/HRM Years
7 GM/ Sr. GM/ CA 15 Years
VP/ Sr. VP Graduate Engineer 16-18 Years
University Diploma in Pulp & Paper 18-20 Years
Technology/Process
Instt./Mech./Elect./Civil
MBA/M.S.W./PG Diploma in 18-20
Personnel Management/HRM Years

(Source: Century Pulp & Paper Mill, Lalkuan)

 166

Annexure 4

The sample of the final identification list in CPP

E. Name Qualification Exp. Skill Training Training Code

Code of (Prior to Level Type & Name
Employee CPP)
S1222 Mithilesh 0 2 BEHEVI BOOI
Kumar BEHAVIOURAL
SKILL
2 F&S F004 UNSAFE
CONDITIONS &
ACTS
2 F&S F007 SAFETY
RELATED
RULES & ACTS
3 TECHNI FCO1
EVAPORATOR
OPERATION
AND ROLE OF
PUMPS
S1296 Rajender Dip. Chem. 0 3 BEHEVI BOOI
Kumar Engg. Sp. in BEHAVIOURAL
Pulp & Paper SKILL
2 F&S F007 SAFETY
RELATED
RULES & ACTS
2 OTHERS 0004 ACCIDENT
& FIRST AID
3 TECHNI PC02
CHEMICAL
RECOVERY
BOILER
OPERATION

(Source: Century Pulp & Paper Mill, Lalkuan)

 167

Annexure 5
Sample of analyses of training need in CPP

S. No. Department Staff Worker Total

1 RGP Process 4 10 14
2 RGP Maintenance 2 8 10
3 WPP Process 5 25 30
4 WPP Maintenance 3 18 21
5 Recovery Process 6 28 34
6 Recovery Maintenance 2 20 22
7 Power House 4 22 26
TOTAL 26 131 137

(Source: Century Pulp & Paper Mill, Lalkuan)

 168

Annexure 6
Specimen of Annual Calendar in CPP
(Here joint indicates staff and workers both.)

S. Topic Participants Duration No. Trainer Month

No. of
Prog.
226 JAGENBERG Joint 2 1 Internal Jan-06
REWINDER:
INSTT OVERVIEW
227 THL QCS Joint 2 1 Internal Jan-06
228 ELECTRICAL Joint 2 1 Internal Jan-06
SAFETY
229 TPM AWARENESS Joint 2 1 Internal Jan-06
230 UNSAFE Joint 2 1 Internal Jan-06
CONDITIONS &
ACT
231 USES & Joint 2 1 Internal Jan-06
DEMONSTRATIO
N OF FIRE
FIGHTING
EQUIPMENT
232 ON SITE Joint 2 1 Internal Jan-06
EMERGENCY
PLAN
233 SAFE HANDLING Joint 2 1 Internal Jan-06
OF HAZARDOUS
CHEMICALS
234 ELECTRICAL Workers 2 1 Internal Jan-06
SAFETY
235 NOISE Joint 2 1 Internal Jan-06
POLLUTION
236 HOUSE KEEPING Joint 2 1 Internal Jan-06
237 5-S & KAIZEN Joint 2 2 Internal Jan-06
238 BEHAVIORAL Joint 2 1 Internal Jan-06
SKILLS
239 HEALTH Workers 2 1 Internal Jan-06
RELATED
PROGRAM
240 PAPER MAKING Workers 2 1 Internal Jan-06
IN BAGASSE

(Source: Century Pulp & Paper Mill, Lalkuan)

 169

Annexure 7
HUMAN RESOURCE DEVELOPMENT
DEPARTMENT
ATTENDANCE LIST OF PARTICIPANTS

_________________________________________________________________
Topic Course Code:
FACULTY: Venue:

DATE: Timings: from In

S. Token/Code No. Name Designation Department Signature

NO.
1
2

(Source: Century Pulp & Paper Mill, Lalkuan)

 170

Annexure 8
For Sectional Head & HOD:

EFFECTIVENESS OF TRAINING

RATING OBSERVATION
4 Understood concept and can very well explain as well as show
practically.
Has the ability of being a good trainer.
3 Understood concept and can show practically.
2 Understood concept and can very well explain.
1 Understood concept but is not in a position to explain.
0 Did not understood at all.

TO: HRD DEPTT.

E.C.NO./T.No. Name Previous Skill HODs Rating

Level (0,1,2,3,4)

(Signature of concerned Sectional Head) (Signature of HOD)

DOC.NO. TRG-F13, Issue NO. 02

(Source: Century Pulp & Paper Mill, Lalkuan)

 171

Annexure 9
CENTURY PULP AND PAPER MILL, LALKUAN
HUMAN RESOURCE DEVELOPMENT DEPARTMENT
FACULTY FEEDBACK FORM

TO: HUMAN RESOURCE DEVELOPMENT DEPARTMENT

FACULTY CODE:

FROM:
EMPLOYEE CODE:

COURSE CODE:

--------------------------------------------------------------------------------------------------

PROGRAMME DETAILS

COURSE TITLE:
DATE: FROM: TO:
DURATION:

--------------------------------------------------------------------------------------------------

KINDLY GIVE YOUR COMMENTS ON THE FOLLOWING:

a) EXISTING COURSE CONTENTS:

b) NUMBER OF PARTICIPANTS:
c) INVOLVEMENT OF PARTICIPANTS:
d) INTELLECTUAL LEVEL OF THE GROUP:
e) REFLECTION OF THE WORK CULTURE:
f) PHYSICAL ARRANGEMENTS:
g) WOULD YOU BE INTERESTED IN TAKING : (YES/NO)

THE SAME COURSE IN FUTURE

h) WOULD YOU BE INTERESTED IN TAKING : (YES/NO)

ANY OTHER COURSE IN FUTURE

--------------------------------------------------------------------------------------------------

COMMENTS & SUGGESTIONS ON ANY OTHER ASPECTS OF THE

COURSE:
 172

DATE: SIGNATURE OF
TRAINER

--------------------------------------------------------------------------------------------------

COMMENTS OF THE HEAD (HRD) & FOLLOW UP ACTION:

DATE: SIGNATURE OF HEAD (HRD)

--------------------------------------------------------------------------------------------------

DOC NO. TRG-F-10, ISSUE NO.03

CENTURY PULP AND PAPER MILL, LALKUAN

HUMAN RESOURCE DEVELOPMENT DEPARTMENT
OUTSIDE TRAINING

DATE: _________

NAME ___________________ E.CODE/T.No. __________

DESIGNATION _____________ DEPTT. _________

1. TRAINING SUBJECT

2. IMPARTED BY / ORGANISED BY
3. VENUE
4. DURATION OF THE PRORAMME
5. COST TO COMPANY

a. Course Fees
b. Other Expenses
(T.A., D.A. Conveyance etc.)

6. THE MAIN POINTS/CONTENTS OF THE TRAINING PROGRAMME

(Please Specify)

7. WHAT ALL YOU ACTUALLY LEARNED FROM THIS TRAINING

PROGRAMME?
 173

8. HOW WILL YOU APPLY THE KNOWLEDGE GAINED? (ACTION

PLAN)

9. DO YOU RECOMMEND THIS PROGRAMME FOR OTHERS? WHY?

10. HAVE YOU SUBMOTTED HANDOUTS/STUDY MATERIALS

PROVIDED DURING TRAINING PROGRAMME TO HRD
DEPARTMENT FOR INCULSION IN HRD LIBRARY?

(SIGNATURE OF PARTICIPANT) (SIGNATURE OF DEPPT.

HEAD)
DOC.NO. TRG-F-08, ISSUE NO.02

(Source: Century Pulp & Paper Mill, Lalkuan)

 174

Questionnaire for the Executives of Century Pulp &

Paper Mill (CPP).

Name: Age: Gender:

Designation: Work tenure in CPP:

1. Are the organizational objectives clear to you?

a) Very true b) True c) Partly true d) Not true.
2. Are you clear about the tasks to be carried out to achieve organizational
goal?
a) Very true b) True c) Partly true d) Not true
3. Is the HR department’s performances interlinked with other departments?
a) Very true b) True c) Partly true d) Not true

4. Is the HR department well organized and properly staffed with qualified

professionals?
a) Very true b) True c) Partly true d) Not true

5. Is the need for manpower identified before recruitment process in your

organization?
a) Very true b) True c) Partly true d) Not true

6. Is the HR department able to attract qualified employees?

a) Very true b) True c) Partly true d) Not true

7. Is the same recruitment procedure followed for all levels of the

organization?
a) Very true b) True c) Partly true d) Not true

8. Which method for recruitment is carried out in your company?

a) Internal b) External c) Both.

9. Do the company take any technological support for recruitment process

like telephone, video conferencing etc.
a) Very true b) True c) Partly true d) Not true

10. Is there a well structured questionnaire for the interview process?

a) Very true b) True c) Partly true d) Not true

11. Is interviewer given training in interviewing and other techniques before

interview?
a) Very true b) True c) Partly true d) Not true

12. Are the tests and interviews non-biased?

a) Very true b) True c) Partly true d) Not true
 175

13. Are the questions asked by the interviewer well enough to judge a
candidate’s knowledge and skill?
a) Very true b) True c) Partly true d) Not true

14. Is the induction program well planned and important for the
organization?
a) Very true b) True c) Partly true d) Not true

15. Does the HR department spend time with the new employee during his
induction period?
a) Very true b) True c) Partly true d) Not true

16. Are the training needs regularly assessed by the company?

a) Very true b) True c) Partly true d) Not true

17. Are the training techniques used, up to mark?

a) Very true b) True c) Partly true d) Not true

18. Is there any feedback procedure adopted after the training session by the
HR department?
a) Very true b) True c) Partly true d) Not true

19. Do you think your department makes necessary efforts to retain qualified
employees?
a) Very true b) True c) Partly true d) Not true

20. How would you rate employee’s motivation of CPP?

a) Unsatisfactory b) Below Average
c) Average d) Outstanding.

21. Is the company having any policy to assist employees on personnel

issues that may affect their performance at work?
a) Very true b) True c) Partly true d) Not true

22. Is the communication procedure of the HR department effective?

a) Very true b) True c) Partly true d) Not true

23. How often you face grievance in your company?

a) Very true b) True c) Partly true d) Not true

24. Is there any formal channel to redress grievance in the company?

a) Very true b) True c) Partly true d) Not true

25. Most of the grievance are related to:

a) Work group b) Work environment
c) Salary d) Supervision
26. Is there a proper procedure to record maintenance on each grievance?
a) Very true b) True c) Partly true d) Not true
 176

Questionnaire for the Unskilled Employees of Century Pulp &

Paper Mill (CPP).

Name: Age: Gender:

Work tenure in CPP:

1. Are the organizational objectives clear to you?

a) Very true b) True c) Partly true d) Not true

2. Is the HR department working effectively for the welfare of employees?

a) Very true b) True c) Partly true d) Not true

3. Are the services provided by HR department effectively and easily

accessible to all the employees?
a) Very true b) True c) Partly true d) Not true

4. Are the internal applicants given equal opportunity by the HR department

for recruitment and selection?
a) Very true b) True c) Partly true d) Not true

5. Are the tests and interview techniques non-biased?

a) Very true b) True c) Partly true d) Not true

6. Is the time provided for induction program sufficient and useful for new
employees?
a) Very true b) True c) Partly true d) Not true.

7. Is the job of new employees explained to him clearly during his

induction?
a) Very true b) True c) Partly true d) Not true

8. Are you well informed in advance about the training schedules and topics
by the HR department?
a) Very true b) True c) Partly true d) Not true

9. Is the place where training is conducted comfortable?

a) Very true b) True c) Partly true d) Not true

10. Is the mode of teaching effective during training session?

a) Very true b) True c) Partly true d) Not true

11. Do you think that training enhances your skills and hence improves the
quality of your work?
a) Very true b) True c) Partly true d) Not true
 177

12. Are you satisfied with the incentives provided by the company?
a) Very true b) True c) Partly true d) Not true

13. Do you enjoy going to work daily and performing at your best?
a) Very true b) True c) Partly true d) Not true

14. Are you provided with the opportunities to express your ideas to upper
management?
a) Very true b) True c) Partly true d) Not true

15. Does your superior listens to your concerns and support your
suggestions?
a) Very true b) True c) Partly true d) Not true

16. Do you think that you work in a safe, healthy and comfortable
environment?
a) Very true b) True c) Partly true d) Not true

17. What factor motivates you the most:

a) Monetary b) Non-Monetary c) Both.
18. How would you rate employee motivation in CPP?
a) Very true b) True c) Partly true d) Not true

19. Are you satisfied with your recent appraisals?

a) Very true b) True c) Partly true d) Not true

20. Are you aware of the committees in your organization that redress
grievance?
a) Very true b) True c) Partly true d) Not true

21. Most of your grievance are related to:

a) Work group b) Work environment
c) Salary d) Supervision
22. Are you satisfied with the current grievance settlement system of CPP?
a) Very true b) True c) Partly true d) Not true

23. Towards which area, HR and organizational needs to work on according

to you? (Answer in 30 words)
a) Salary/Wages b) Employees Work c) Housing Facilities
d) Social Security e) Medical Facilities f) Labour Welfare
g) Working Conditions
 178

Questionnaire for the Skilled Employees of Century Pulp & Paper Mill
(CPP).

Name: Age: Gender:

Work tenure in CPP:

1. Are the organizational objectives clear to you?

a) Very true b) True c) Partly true d) Not true

2. Is the HR department working effectively for the welfare of employees?

a) Very true b) True c) Partly true d) Not true

3. Are the services provided by HR department effectively and easily

accessible to all the employees?
a) Very true b) True c) Partly true d) Not true

4. Are the internal applicants given equal opportunity by the HR department

for recruitment and selection?
a) Very true b) True c) Partly true d) Not true

5. Are the tests and interview techniques non-biased?

a) Very true b) True c) Partly true d) Not true

6. Is the time provided for induction program sufficient and useful for new
employees?

a) Very true b) True c) Partly true d) Not true

7 Is the job of new employees explained to him clearly during his

induction?

a) Very true b) True c) Partly true d) Not true

8. Are you well informed in advance about the training schedules and topics
by the HR department?
a) Very true b) True c) Partly true d) Not true

9. Is the place where training is conducted comfortable?

a) Very true b) True c) Partly true d) Not true

10. Is the mode of teaching effective during training session?

a) Very true b) True c) Partly true d) Not true

11. Do you think that training enhances your skills and hence improves the
quality of your work?
 179

a) Very true b) True c) Partly true d) Not true

12. Are you satisfied with the incentives provided by the company?
a) Very true b) True c) Partly true d) Not true

13. Do you enjoy going to work daily and performing at your best?
a) Very true b) True c) Partly true d) Not true

14. Are you provided with the opportunities to express your ideas to upper
management?
a) Very true b) True c) Partly true d) Not true

15. Does your superior listens to your concerns and support your
suggestions?
a) Very true b) True c) Partly true d) Not true

16. Do you think that you work in a safe, healthy and comfortable
environment?
a) Very true b) True c) Partly true d) Not true

17. What factor motivates you the most:

a) Monetary b) Non-Monetary c) Both.
18. How would you rate employee motivation in CPP?
a) Very true b) True c) Partly true d) Not true

19. Are you satisfied with your recent appraisals?

a) Very true b) True c) Partly true d) Not true

20. Are you aware of the committees in your organization that redress
grievance?
a) Very true b) True c) Partly true d) Not true

21. Most of your grievance are related to:

a) Work group b) Work environment
c) Salary d) Supervision
22. Are you satisfied with the current grievance settlement system of CPP?
a) Very true b) True c) Partly true d) Not true

23. Towards which area, HR and organizational needs to work on according

to you? (Answer in 30 words)
a) Salary/Wages b) Employees Work c) Housing Facilities
d) Social Security e) Medical Facilities f) Labour Welfare
g) Working Conditions
 GRIEVANCE & GRIEVANCE HANDLING PROCEDURE – A
CASE STUDY OF CENTURY PULP & PAPER MILL LALKUAN
(NAINITAL)
Megha Bhatt, Research Scholar, Department of Commerce, Kumaon
University, Nainital.

Dr. B. C. Malkani, Principal, M.B.P.G. College, Haldwani, Nainital.

INTRODUCTION
Grievance refers to any dissatisfaction or sense of injustice among employees
working in an organization regarding their pay, working conditions, leave, or any
other aspect of employment. In simpler words we can say that “a grievance is any
dissatisfaction that adversely affects organizational relations and productivity.”1

There are various causes of grievances which may be concerned to working

conditions, management policy & practices, rules & regulations, personal traits etc.
Forms of grievance can also differ from one another as some grievances are due to
legitimate or genuine reason while some are imaginary in nature due to wrong
perception, attitude and information of the employee. Some grievances can be
disguised also i.e. due to pressure on the employee from other directions like family,
friends, neighbors etc. These grievances are sometimes expressed or sometimes not
but in case the grievance is not attended properly can lead to frustration, low
productivity, feeling of discontent or increase in absenteeism among the employees.
In order to avoid grievances to rise in an organization they must be handled carefully
and for that an effective grievance procedure must be followed by every
organization. The Model Grievance Procedure2 has provided the following definition
of grievance: “Complaints affecting one or more individual workers in respect of
their wage payments, leave, transfer, promotions, seniority, work assignment and
discharge would constitute grievance. Where the points at dispute are of general
applicability or considerable magnitude, they will fall outside the scope of this
procedure.”

Industrial relation is a relationship between the management and the employees

concerned with the organization and to avoid grievances in an organization Industrial
Relation also play a significant role. As sound industrial relation helps in
uninterrupted productivity, promotes industrial democracy, reduces industrial
conflicts and facilitates change. While in case of poor industrial relations, industrial
disputes may take place within the organization in the form of strikes, lockout,
gherao, picketing, boycott etc. If in case employers and employees fail to sort out
their differences themselves in such case Industrial Disputes Act, 1947 provides a
legalistic machinery to settle such dispute.

STATEMENT OF THE PROBLEM

Century Pulp & Paper Mill Lalkuan (Nainital), abbreviated as CPP, is a member of
B.K. Birla group of companies, leading in the integrated Pulp & Paper plants. Mr.
Basant Kumarji Birla is the chairman of the company. The company was established
in the year 1984 in Lalkuan on the Bareilly Nainital highway, is pioneer in bagasse
based paper throughout the country having total workforce of 2919 employees
including approx 3000 as temporary or unskilled workers. In this research, researcher
tries to focus on the grievance and grievance handling procedure in Century Pulp &
Paper Mill Lalkuan (Nainital).

OBJECTIVES OF THE STUDY

The purpose of this paper is to study the grievance and grievance handling procedure
being adopted by the Mill in order to avoid any industrial dispute to arise within the
organization. And if, all the employees working in the mill are getting benefited by
such redressal committee or not?

RESEARCH DESIGN
1. All the research related to the study will be conducted on the employees
working in Century Pulp & Paper Mill Lalkuan (Nainital).

2. These employees will be skilled as well as unskilled.

METHODOLOGY USED
Methodology used for this research is based on primary as well as secondary data.
Secondary data is obtained from the Human Resource Department of CPP while for
primary data both skilled as well as unskilled employees of the mill were questioned
through the questionnaire cum schedule method. Sample size taken for the collection
of primary data is as:

No. of Executives questioned in CPP – 10

 No. of Skilled Employees questioned in CPP – 100

No. of Unskilled Employees questioned in CPP – 100

Then the data thus collected is changed into percentile form to draw the conclusion.

Percentage taken for the answers are as-

1. Very True 76% - 100%
2. True 51% - 75%
3. Partly True 26% - 50%
4. Not True 0% - 25%

LITERATURE REVIEW
Till now various works have been done in the study of Grievance & Grievance
handling procedure but no such work is been done on this field in Century Pulp &
Paper Mill, Lalkuan. Here I would like to present literature of some of the relevant
studies being done by the different researchers in this area and the related aspects.

Lawrence Nurse, Dwayne Devenish, (2007)3 in his working paper entitled

“Grievance Management and its Links to Workplace Justice” The purpose of this
paper is to explore the influence of workers’ demographic characteristics on their
perceptions of procedural justice from grievance management. A related aim is to
determine whether procedural justice perceptions have an impact on perceptions of
distributive justice.

Dr. V. Mohana Sundaram, N. Saranya, (2013)4 in his article “Employee Grievance”

Organizations are made up of people and functions through people without people
organization cannot exist. The resource of men, money, materials and machinery are
collected, coordinated and utilized through people in the organization. It is through
the combined efforts of people that materials and monetary resources are effectively
utilized for the attainment of common objectives and goals without united human
efforts no organization can achieve its goals.

“The handling of special grievances may involve special steps as well as, or in place
of, skipping certain steps within normal grievance channels”, by Petterfer, J. C.,
Effective Grievance Arbitration in California Management Review. 1970.5

Khurshid Khurana6 carried out a study on “Human Resource Development Practices

in Large Scale Industries in the Pune Metropolitan Region”. His findings reveal that
large scale industries in Pune do follow certain logical procedures for human
resource practices.

CONSTRAINTS

1. Executives and skilled as well as unskilled workers were not ready to give the
answers of questions being asked to them. They were not so cooperative.

2. Some of the unskilled workers were not aware of the questions being asked to
them and were feeling shy to give the answers.

GRIEVANCE & GRIEVANCE HANDLING PROCEDURE IN

CPP MILL LALKUAN (NAINITAL)

If an employee in CPP Lalkuan faces any type of grievance he will get it solved
through a proper channel. He’ll first go to his supervisor with his grievance and if
possible the supervisor will try to solve his problem but in the other case, if problem
is not solved, the supervisor will send the problem to his superior and through
superior it will be transferred to the HOD. If again, the problem remains unsolved,
HOD will transfer the grievance to the Personnel Department.
Once, the grievance reaches to the personnel department, both the representatives of
the trade union and employers are called together to settle down the grievance. But if
the grievance is not settled again, it is taken to the Deputy Labour Commissioner by
the trade union. The commissioner takes written statement of both the parties and
goes for domestic enquiry for taking certain legal actions. At last the Counsellation
Officer takes the grievance to Labour Court for settlement, and the grievance
changes into a dispute between employees and company.
The last major dispute that took place in CPP due to reduction in bonus percentage
due to the economic crisis faced by the management at that time was in the year
1998. The mill remained under lockout for 65 days. During this period meetings,
discussions & negotiations at different levels took place and finally it was agreed to
start the mill under the jurisdiction of the court in this matter. The workmen were
given 8.33% bonus and one month salary/wages as an advance to meet out their
burning problems. Since, 1998 till now no such Industrial dispute has arose in CPP.
After getting the feedback on the questions asked by the researcher based on
 Grievance & grievance handling procedure of CPP, following tables were obtained
by the researcher:

Feedback of Skilled Employees on Grievance & Grievance Handling in CPP

Questions Very True Partly Not True

True True
Satisfaction with Recent 14% 51% 33% 2%
Appraisals
Awareness of Grievance 44% 37% 10% 9%
Redressal Committee
Causes of Grievance Work Work Salary Supervision
Group Environment 56% 14%
13% 17%
Satisfaction with 28% 48% 20% 4%
Grievance Redressal
System

Feedback of Unskilled Employees on Grievance & Grievance Handling in CPP

Questions Very True Partly Not True

True True
Satisfaction with Recent 6% 74% 20% Nil
Appraisals
Awareness of Grievance 25% 48% 26% 1%
Redressal Committee

Causes of Grievance Work Work Salary Supervision

Group Environment 58% 24%
11% 7%
Satisfaction with Grievance 12% 53% 35% Nil
Redressal System

After going through the tables above it was seen that Workers when asked about
their satisfaction with the recent appraisal, 14% of skilled workers gave answer as
very true, 51% true, 33% partly true while 2% gave answer as not true. On the other
hand only 6% of the unskilled workers gave answer as very true, 74% as true and
20% as partly true. Workers when enquired whether they were aware of the
grievance redressal committee in CPP 44% of skilled workers gave answer as very
true while only 25% of the unskilled workers gave answer as very true. Workers then
were asked about the causes of their grievances 13% of the skilled workers gave the
cause as work group, 17% as work environment, 56% as salary and 14% as
supervision. While the causes for unskilled workers were as 11% work related to
work group, 7% work environment, 58% as salary and 24% as supervision. Then the
workers were asked whether they are satisfied with the grievance redressal system or
not 28% of skilled workers gave answer as very true, 48% as true, 20% as partly true
and 4% as not true. On the other hand unskilled workers gave answer as 12% very
true, 53% true and 35% as partly true.

CONCLUSION
When skilled as well as unskilled employees in CPP were asked about the grievance
and grievance redressal system of CPP, through the feedback researcher concluded
that CPP is having a set grievance handling procedure within its organization but
many unskilled workers in comparison to the skilled workers working in the mill are
not very much aware of the redressal committee present in CPP, how it works or
how it is helpful to them and due to their such ignorance only they are not very much
satisfied with the redressal committee.
REFERENCES

1. Jucius, Michael J. (1978). Personnel Management. D. B Taraporevala Sons

& Company. Bombay. P- 459.

2. Government of India. (1969). Report of the National Commission of Labour,

Ministry of Labour, Employment and Rehabilitation, New Delhi.

3. Lawrence Nurse, Dwayne Devenish, (2007). Grievance Management and its

Links to Workplace Justice. Employee Relations Volume – 29. Issue – 1.

4. Dr. V. Mohana Sundaram, N. Saranya, (2013). Employee Grievance. Journal

of Business Management & Social Science Research (JBM & SSR), ISSN
No. 2319-5614, Volume 2. No. 3. March 2013.

5. http://www.ukessays.com/essays/management/grievance-handling-
procedure-and-reliance-communication-management-essay.php

6. Khurana Khurshid. (Feb 1997). Human Resource Development in Large

Scale Industries in Pune Metropolitan Region.

7. Khanka, S.S. (2009). Human Resource Management. S Chand & Company

Ltd. Delhi.

8. Kapoor T. N. (ed.) (1968). Personnel Management and Industrial Relations

in India. Tripathi & Sons. Bombay.

9. Singh V. B. (1966). Climate for Industrial Relations. Asia Publishing House.

Bombay.

10. Patterson. (1948). Social Aspects of Industry. Oxford University Press.

Bombay.

11. Section 2(a) of the Industrial Disputes Act, 1947.

12. Section 2(i) of the Industrial Disputes Act, 1947.

13. http://dictionary.reference.com/browse/gherao.

14. http://www.legalserviceindia.com/articles/ind_dis.htm.

15. Flippo Edwin B. (1989). Personnel Management. McGraw Hill. New York.

16. Section 2(h) of the Trade Unions Act, 1926.

To ,
Megha Bhatt,
Research Scholar,
Department of Commerce,
M.B.Govt. PG College,
Haldwani (Nainital)

Ref: Acceptance of your research article for publication in edited book.

Dear Megha,

I am happy to inform you that your research article “FOREIGN DIRECT

INVESTMENT AND DEVELOPING WORLD: IN CONTEXT TO INDIA”,
has been accepted for publication in the edited book of selected papers contributed
for the UGC sponsored national seminar on “foreign Direct Investment in India:
Opportunities and Challenges” to be organized by the Department of Economics,
Government PG College, Ramnagar on 26-27 February, 2015.

I appreciate your effort.

(Dr. Sangeeta Gupta)

Associate Prof. & HOD Economics,
Organizing Secretary, National Seminar.
Government PG College , Ramnagar.
FOREIGN DIRECT INVESTMENT AND DEVELOPING
WORLD: IN CONTEXT TO INDIA.

Megha Bhatt, Research Scholar, Department of Commerce, M.B.G.P.G.

College, Haldwan, Nainital.
Dr. B. C. Malkani, Principal, M.B.G.P.G. College, Haldwani, Nainital.
-----------------------------------------------------------------------------
ABSTRACT
Foreign Direct Investment (FDI) plays significant role in the development of any
nation. Its importance increases in case of any developing or under developed
country. FDI in India is governed by the FDI policy announced by the Government
of India and the provision of the Foreign Exchange Management Act (FEMA) 1999.
The credit of liberalized economy in India goes to then Prime Minister Dr.
Manmohan Singh, who gave India the gift of New Economic Policy, 1991, having
the three elements as LPG (Liberalization, Privatization and Globalization). FDI in
today’s global world has become an important source of private external finance for
the developing countries as FDI not only adds to invested resources and capital
formation but more significantly it is also a means of transferring production
technologies, skill, innovative techniques, and managerial practices between
different countries. It also helps in accessing international marketing networks. In
India, FDI is considered be a development tool, which helps India to achieve self
reliance in various sectors and hence in the overall development of the economy. The
paper analysis the impact of FDI in developing world with the special attention
provided here to the economy of India. The paper also tries to find out whether the
FDI flow has positive or negative effect in the country’s economy and whether the
local people and investors are getting benefitted by the FDI floe in into the country
or not? Identifying the impact of FDI on the Indian economy and local investors and
people researcher has also tried to give suggestive measures to strengthen the FDI
flow in the developing countries like India.
----------------------------------------------------------------------------------------

INTRODUCTION
Foreign Direct Investment (abbreviated as FDI) means “cross border investment
made by a resident in one economy in an enterprise in any economy, with the
objective of establishing a lasting interest in the investee economy.”1 In simpler
words we can say that FDI is controlling ownership of a business enterprise in one
country by the entity based in another country.
Foreign investment in India is governed by the FDI policy announced by the
Government of India and the provision of the Foreign Exchange Management Act
(FEMA) 1999. The Reserve Bank of India (RBI) in this regard has issued a
notification, which contains the Foreign Exchange Management (Transfer or issue of
security by a person resident outside India) Regulations 2000. This notification has
been amended from time to time. The Ministry of Commerce and Industry,
Government of India is the nodal agency for monitoring and reviewing the FDI
policy on continued basis and changes in sectoral policy/ sectoral equity cap. The
FDI policy is notified through Press Notes by the Secretariat for Industrial
Assistance (SIA), Development of Industrial Policy and Promotion (DIPP).2

The foreign investors can invest in India freely, except few sectors or activities
where prior approval from the RBI or Foreign Investment Promotion Board (FIPB)
is required.

STATEMENT OF PROBLEM
The specified research paper tries to cover the term FDI i.e. Foreign Direct
Investment, its meaning, its various characteristics along with is impact in the
different countries of the world. The special attention is made on one of the
developing country i.e. India.

OBJECTIVES OF THE STUDY

The main objectives of this paper are:
1. To study the term FDI.
2. To evaluate the impact of FDI on developing countries basically India and
3. To find out how FDI can be helpful in overall growth of the nation while keeping
the interests of the local investors and people intact.

HYPOTHESIS
1. FDI has a positive impact on economic growth of the country.
2. FDI helps in keeping the interest of the local investors and people intact.

METHODOLOGY USED
The above study is based on secondary data for which the data is collected from
various sources such as World Investment Reports, various bulletins of Reserve
Bank of India, Secretariat of Industrial Assistance etc. Various websites of World
Bank, WTO, IMF, EXIM Bank, UNCTAD etc. were surfed. Once the data was
collected it was analysed by the researcher in order to draw different conclusions.
LITERATURE REVIEW
Balasubramanyam. V. N. and Vidya Mahambre (2003) concluded that FDI is a very
good means for the transfer of technology and knowhow to the developing
countries.3

Laura Alfaro (2003) finds that FDI flows into the different sectors of the economy
(namely primary, manufacturing, and services) exert different effects on economic
growth. FDI inflows into the primary sector tend to have a negative effect on growth,
whereas FDI inflows in the manufacturing sector a positive one. Evidence from the
foreign investments in the service sector is the ambiguous.4

Iyare Sunday O, Bhaumik Pradip K, Banik Arindam (2004), in their work

“Explaining FDI Inflows to India, China and the Caribbean: An Extended
Neighborhood Approach” find out that FDI flows are generally believed to be
influenced by economic indicators like market size, export intensity, institutions etc,
irrespective of the source and destination countries. This paper looks at FDI inflows
in an alternative approach based on the concepts of neighborhood and extended
neighborhood. The study shows that the neighborhood concepts are widely
applicable in different contexts particularly for China and India, and partly in the
case of the Caribbean. There are significant common factors in explaining FDI
inflows in select regions.5

Singh (2009) stated in their study that foreign direct investment (FDI) policies play a
major role in the economic growth of developing countries around the world.
Attracting FDI inflows with conductive policies has therefore become a key
battleground in the emerging markets. The paper highlighted the trend of FDI in
India after the sector wise economic reforms.6

Devajit (2012) conducted the study to find out the impact of foreign direct
investments on Indian economy and concluded that Foreign Direct investment (FDI)
as a strategic component of investment is needed by India for its sustained economic
growth and development through creation of jobs, expansion of existing
manufacturing industries, short and long term project in the field of healthcare,
education, research and development.7

Klaus E Meyer, Saul Estrin, Sumon Bhaumik, Stephen Gelb, Heba Handoussa,
Maryse Louis, Subir Gokarn, Laveesh Bhandari, Nguyen, Than Ha Nguyen, Vo
Hung (2005) in their paper “Foreign Direct Investment in Emerging Markets: A
Comparative Study in Egypt, India, South Africa and Vietnam” show considerable
variations of the characteristics of FDI across the four countries, all have had
restrictive policy regimes, and have gone through liberalization in the early 1990.
Yet the effects of this liberalization policy on characteristics of inward investment
vary across countries. Hence, the causality between the institutional framework,
including informal institutions, and entry strategies merits further investigation. This
analysis has to find appropriate ways to control for the determinants of mode choice,
when analyzing its consequences. The study concludes that the policy makers need
to understand how institutional arrangements may generate favourable outcomes for
both the home company and the host economy. Hence, we need to better understand
how the mode choice and the subsequent dynamics affect corporate performance and
how it influences externalities generated in favour of the local economy.8

CONSTRAINTS
1. It is not only FDI which affects the growth of economy on any country while
there are other factors too such as monetary policy, government policy, fiscal
policy etc.
2. Time limitation.
3. FDI data keeps on changing from time to time.

EVOLUTION OF FDI IN INDIA

Evolution of FDI in India may be seen from post independence era. However due to
lack of abundant and authentic data, researchers could not present the complete
history of FDI inflow in India. Before independence maximum of FDI inflow in
India was from Britain. After Second World War Japanese companies started
entering into Indian market and thus enhanced their trade with India yet U.K. was the
dominant investor in India. After independence also the policy makers were inclined
towards the issues related to foreign capital in India, therefore, the FDI policies were
so designed with the aim of acquiring advanced technology and mobilizing foreign
exchange resources in the country.
Jawaharlal Nehru, the first Prime Minister of India considered foreign investment as
necessary which not only supplements domestic capital but also secures scientific,
technical, industrial knowledge and capital equipments. Jawaharlal Nehru with
statistician Prasanta Chandra Mahalanobis formulated and oversaw economic
policies during his governance.
With time and as per economic & political regimes there have been the changes in
FDI policy too. The industrial policy of 1965, allowed MNCs to venture through
technical collaboration in India. However, the country faced two severe crisis in the
form of foreign exchange and financial resource mobilization during the second five
year plan (1956-61). Therefore, the government adopted a liberal attitude by
allowing more frequent equity participation to foreign enterprises, and to accept
equity capital in technical collaborations. The government also provides many
incentives such as tax concessions, simplification of licensing procedures and de-
reserving some industries such as drugs, aluminium, heavy electrical equipments,
fertilizers, etc in order to further boost the FDI inflows in the country. This liberal
attitude of government towards foreign capital lures investors from other advanced
countries like USA, Japan, and Germany, etc but due to significant outflow of
foreign reserves in the form of remittances of dividends, profits, royalties etc, the
government has to adopt stringent foreign policy in1970s.9 During this period, the
Government led by Morarji Desai eased restrictions on capacity expansion for
incumbent companies, removed price controls, reduced corporate taxes and
promoted the creation of small scale industries in large numbers. However, the
subsequent government policy of Fabian Socialism hampered the benefits of the
economy, leading to high fiscal deficits and a worsening current account. The
collapse of the Soviet Union, which was India’s major trading partner, and the Gulf
War, which caused a spike in oil prices, resulted in a major balance of payments
crisis for India, which found itself facing the prospect of defaulting on its loan. India
asked for a $1.8 billion bailout loan from the International Monetary fund (IMF),
which returned demanded de-regulation. 10
To get out from this situation then Prime Minister Narasimha Rao along with his
Finance Minister Dr. Manmohan Singh initiated the economic liberation reform in
1991 which is considered to be one of the milestones in Indian Economic Reform as
it helped our country in changing its market and financial scenario. Under this
program FDI was encouraged, public monopolized were stopped and tertiary sector
was developed. This liberation reform of year 1991 is popularly known as New
Economic Policy 1991. The major elements of New Economic Policy 1991 were as:
1. Liberalization- refers to an end of license, quota and other such restrictions which
were put on various industries before this policy. Companies got liberalization in
many ways as now no restriction was put on any company for further expansion
or contraction of business activities, liberalization in import and export, easy and
simple procedure to attract foreign capital etc.
2. Privatization- refers to reducing role of public sector by giving greater role to
private sector. Under this Board of Industrial and Financial Reconstruction
(BIFR) was set up to revive sick units in public sector.
3. Globalization- refers to integration of different economies of the world. For this
government removed various restrictions from import of capital gods. Foreign
exchange Regulation Act (FERA) was replaced by Foreign Exchange
Management Act (FEMA). Export duties were abolished and Import duties were
reduced.
 These three elements of New Economic Policy are also known as LPG. Due to the
introduction of LPG physical and political boundaries remained no barrier for
business enterprises and the whole world became a global village.

FDI AND GLOBAL DEVELOPING ECONOMY

FDI in today’s global world has become an important source of private external
finance for the developing countries. As FDI represents investment in production
facilities but its importance for developing countries is much greater. FDI not only
adds to invested resources and capital formation but more significantly it is also a
means of transferring production technologies, skill, innovative techniques, and
managerial practices between different countries. It also helps in accessing
international marketing networks. Here, the challenges for developing countries are
to develop and arrange a well calibrated and unique combination of factors that
determine the FDI location and thus match those factors with corporations’
strategies. FDI policies are intended to strengthen the national innovation pattern and
thus encourage the spread of technology as this will increase the nations’ ability to
create assets.
Global trends show that FDI has splayed a relatively minor role in the aggregate
capital flows of developing countries, so greater attention to FDI policies is required
by them. This situation is seen after the onset of debt crisis in the early 1980s, along
with the debt crisis FDI also simultaneously got adversely affected. The ASEAN
countries, owing to their large growth potential, on the other hand, have attracted a
large volume of FDI, though there have been large inter country variations in the
FDI-GDP ratios within the ASEAN. Private, including foreign, investment now
accounts for over two thirds of total investment in Indonesia, compared with about
50 percent in the early 1980s’ and is estimated to account for about three quarters of
Indonesia’s overall economic growth since 1983. However, despite these trends, FDI
is still concentrated in developed countries.11 Table below shows this position:

GLOBAL FOREIGN DIRECT INVESTMENT FLOWS

(1981-1993)
(US$ billion)
1981-85 1986-90 1990 1991 1992 1993
World 48 168 232 192 171 195
Industrialized Countries 47 163 222 185 162 181
Developing Countries 1 6 10 7 9 14
Former USSR and Eastern Europe 0.004 0.02 0.04 0.01 0.03 n.a.
Notes:
1. “Industrialized Countries” include the members of the OECD, Israel and
South Africa.
2. Figures for 1981-85 and 1986-90 are averages for years covered. Figures for
1993 are early reports.
3. “Developing Countries” exclude Hong Kong.
(Source: UNCTAD, World Investment report 1994, Geneva.)

Further, if we move after the year 1993 and see the FDI inflows from 1995 up to
2016 we may find the position as given in graph below:

FDI INFLOWS, GLOBAL AND BY GROUP OF ECONOMIES

1995-2013 AND PROJECTIONS, 2014-2016
(BILLIONS OF DOLLARS)

Source: UNCTAD, World Investment Report 2014.

Here, from the above graph it may be concluded that after 1995 FDI in developed
economies was growing at an increasing speed up till year 2000 then there was a
drastic downfall in the years 2001 and 2008. And up to the projected year 2016 the
FDI inflow is uneven whereas in case of developing and transition economies there
is a constant increase in almost every year except in the year 2008-2009.

FOREIGN DIRECT INVESTMENT IN INDIA

Starting from a baseline of less than $1 billion in 1990, a recent UNCTAD survey
projected India as the second most important FDI destination (after China) for
transnational corporations during 2010-2012. As per the data, the sectors which
attracted higher inflows were services, telecommunication, construction activities
and computer software and hardware. Mauritius, Singapore, the US and the UK were
among the leading sources of FDI. FDI in 2010 was $24.2 billion, a significant
decrease from both 2008 and 2009. Foreign Direct Investment in August 2010
dipped by about 60% to approx $34 billion, the lowest in 2010 fiscal, industry
department data released showed. In the first two months of 2010-11 fiscal, FDI
inflow into India was at an all time-high of $7.78 billion up 77% from $4.4 billion
during the corresponding period in the previous year. The world’s largest retailer
WalMart has termed India’s decision to allow 51% FDI in multi-brand retail as a
“first important step” and said it will study the finer details of the new policy to
determine the impact on its ability to do business in India.12

FOREIGN DIRECT INVESTMENT AND INDIAN ECONOMY

FDI plays a significant role in the long term development of any country.
Developing countries, in particular consider FDI as the most safest type of external
finance as FDI not only acts as a source of capital in any country rather it also
enhances competitiveness of the domestic economy through transfer of technological
knowhow, innovative techniques and managerial skills. It helps in strengthening
infrastructure by raising productivity and generating new employment opportunities.
India emerges as the fifth largest recipient of foreign direct investment across the
globe and second largest among all other developing countries (World Investment
Report 2010). Sound economic policy, huge market size, abundant and diversified
natural resources, availability of highly skilled human capital are few factors which
enables India to attract FDI. However, it was found that though there was increased
flow of FDI into the country during the post liberalization period but then also the
global share of FDI in India was very less when compared to other developing
countries. The reason behind this low FDI in India are due to lack of adequate
infrastructure, corruption, instable government and political environment, high
corporate taxes, stringent labour laws etc. To overcome these shortcomings the
Government of India should revise the sectoral cap, and should allow more
investment into the country under automatic routes. Education sector should be
opened for FDI and R&D should be strengthened in the country. India should also
sign agreement of double taxation treaties with other countries for increasing its
bilateral trades. Indian Government also needs to have innovative policies and good
corporate governance policies having international standards, to attract more and
more foreign capital in various sectors of the economy in order to make India a
developed economy.
Since the debt crisis in the 1980’s and the recent turmoil in emerging markets in the
late1980s, developing countries have changed their attitude towards FDI as it is
believed that FDI can contribute to the development efforts of a country. In general,
if a firm decides to invest in another country it is because of lower costs and higher
efficiency. But the host country can benefit not only from the better use of its
resources, but also from the introduction of new processes to the domestic market,
learning-by-observing, networks, training of the labour force, and other spillovers
and externalities. Because of the “growth-development” benefits FDI seems to
convey, different countries and regions have pursued active policies to attract FDI.
Most countries, including both developed and emerging nations have established
investment agencies with the objective to attract foreign companies. Policies include
both fiscal and financial incentives to attract FDI as well as others that seek to
improve the local regulatory environment and the “cost of doing business” (see
UNCTAD 1999). In simpler words we can say that local people and investors of the
host country have mixed effects from FDI. FDI is said to be positive for the local
investors and people as FDI helps in employment generation, enhancement of human
capital through training and on the job learning, as well as it gives domestic
producers a chance to become more efficient.

FDI can be negative as it may slightly increase the inflation rate, uncompetitive firms
may suffer and if a lot of FDI is into single industry only then there are chances that
the country may become too dependent on it.

CONCLUSION
In today’s world FDI has become an instrument of international economic
integration. India is the seventh largest and second most populated country of South
Asia is known for the diversity of its culture, people and geographical conditions. In
the present era India has become the global resource for industry in manufacturing
and services. Its abundance in technical skills, its plenty of English speaking
population with an increasing disposable income and its rapidly increasing market
has all enabled India to emerge as a viable partner to global industries. Recently
investment opportunities in India can be seek at its peak point.
FDI is seen as an engine of market access in developing and less developed
countries, as it helps them in their technological progress and in maintaining their
economic growth and development. Developing nations think FDI as a source of
filling the foreign reserves, savings, trade deficit etc. FDI is considered to be an
instrument of international economic integration as FDI not only acts as a source of
capital in any country rather it also enhances competitiveness of the domestic
economy through transfer of technological knowhow, innovative techniques and
managerial skills. Impact of FDI depends largely on the domestic as well as foreign
policy of the country, therefore, as a result FDI has a wide range of impact on
country’s economic policy. And recognizing this impact of FDI on country’s
economy, all governments want to attract it. The global market for FDI is highly
competitive, so developing countries in particular seek such investments to increase
their development efforts. Now a days, governments are paying more attentions to
measures that can actively facilitate FDI.
Transnational countries make frequent choices regarding the potential host countries
where they have to locate their production facilities. So, the prospectus for increase
in FDI flow to India in future can get affected due to the favourable changes in the
trade and FDI policies of the other host country. Hence, India needs to introduce
substantial reforms in its trade policy to boost its FDI. An ideal trade policy in India
can also help in keeping the interest of local people and investors intact.
So, at last researcher can conclude that unless India and its economic policies are
marketed strongly, the expected fallouts liberalization policy will remain
dissatisfactory. The only way to create better image of India as a host location is to
reform and introduce stability in the system.

SUGGESTIONS
Thus it is found that FDI is needed by India for its sustained economic growth and
development. FDI is necessary for creation of jobs, capital formation, expansion and
development of existing manufacturing industries. So, the researcher from the study
recommends following suggestion to strengthen FDI in developing countries like
India so as it may be helpful for keeping the interests of local people and investors
intact too:
1. The policy makers should focus on attracting diverse types of FDI in the
country.
2. Equitable distribution of FDI should be ensured by the Government among
different states so that they can attract FDI at their own level. Even additional
incentives should be provided to the foreign investors by the government to
invest in states having low rate of FDI.
3. India has pool of working population which needs reforms in primary and
higher education so government should encourage FDI in this sector too.
4. Government should also look forward to invest more in improvement of health,
R&D activities, infrastructure sector, human capital, technological advancement
to attract more of FDI.
5. FDI should be guided to establish deeper linkages with the economy in order to
stabilize the economy and provide the investors a sound and reliable
macroeconomic environment.
6. India is basically an agricultural country so there is plenty of scope in food
processing and agricultural services thus FDI should be encouraged in this field
too.
7. Finally, policy makers must ensure that the optimum utilization of funds and
timely implementation of projects is being done and for this while pursuing
judicious policies government should exercise strict control over inefficient
 bureaucracy, red-tapism and rampant corruption in order to maintain investors’
confidence in attracting more FDI inflows into the country.

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